Elon Musk could be set to lose billions as trial begins over one of his tweets
Topics: Elon Musk, US News, Twitter, Tesla, Technology
Dominic Smithers
Featured Image Credit: UPI / Alamy Stock Photo/Simona Pezzi / Alamy Stock Photo
Topics: Elon Musk, US News, Twitter, Tesla, Technology
Elon Musk could stand to lose billions as his Twitter trial gets underway.
The tech billionaire is being sued over two tweets he sent back in 2018, in which he claimed that he was taking Tesla private.
If you follow the Twitter boss on the platform, you will be well aware that anything he posts attracts quite the reaction, both good and bad.
So when he claimed that he was making big changes to his car company, both the market and shareholders took notice.
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His post read: "Am considering taking Tesla private at $420. Funding secured."
This was then followed up by a tweet that suggested a deal was very close.
It sent the market into overdrive, with share prices in the company going crazy.
Tesla’s share price in the two weeks following the post shifted by $14 billion, which suggested that it may have had an impact.
Securities regulators previously ruled that his 2018 tweets were improper and that he was lying.
He was subsequently forced to pay out $40 million and step down as Tesla chairman.
A class-action lawsuit has now been launched by a number of Tesla shareholders who traded their stock in the days after the tweet, claiming that the posts caused them to lose millions.
Musk claimed that the governor of the Saudi kingdom’s Public Investment Fund (PIF) had thrown him 'under the bus' after the deal fell through.
Last year, US District Court Judge Edward Chen stated that despite his defence, Musk's posts were 'false and misleading'.
He said that the 51-year-old 'recklessly made the statements with knowledge as to their falsity'.
Speaking during the trial, Musk's lawyer Alex Spiro said his client was not trying to damage the company's stock price or harm its investors.
"Mr Musk tries to do things that have never been done before. Everyone knows that," he told the jury.
"He didn’t plan to tweet this, it was a split-second decision."
Glen Littleton is one of the Tesla shareholders involved in the case.
He said Musk's tweets were massively damaging to him and others, causing his Tesla portfolio to collapse by 75 percent.
"The damage was done," the 71-year-old said. "I was in a state of shock."
When he was asked whether he had a legitimate reason for believing that the buyout was set to be finalised, Mr Littleton said: "'Funding secured' was the only thing that mattered to me. That was such a defining statement."
The trial is set to last three weeks, however, often in cases such as this, a settlement is reached between the two parties.