AP

Jury: Musk didn’t defraud investors with 2018 Tesla tweets

Feb 3, 2023, 10:32 AM | Updated: Feb 6, 2023, 3:39 pm

Elon Musk, center, leaves a federal courthouse in San Francisco, Friday, Feb. 3, 2023. A high-profi...

Elon Musk, center, leaves a federal courthouse in San Francisco, Friday, Feb. 3, 2023. A high-profile trial focused on a 2018 tweet about the financing for a Tesla buyout that never happened drew a surprise spectator for Friday's final arguments -- Elon Musk, the billionaire who is being accused of misleading investors with his usage of the Twitter service he now owns. (AP Photo/Jeff Chiu)

(AP Photo/Jeff Chiu)

SAN FRANCISO (AP) — A jury on Friday decided Elon Musk didn’t defraud investors with his 2018 tweets about electric automaker Tesla in a proposed deal that quickly unraveled and raised questions about whether the billionaire had misled investors.

The nine-member jury reached its verdict after less that two hours of deliberation following a three-week trial. It represents a major vindication for Musk, who spent about eight hours on the witness stand defending his motives for the August 2018 tweets at the center of the trial.

Musk, 51, wasn’t on hand for the brief reading of the verdict but he made a surprise appearance earlier Friday for closing arguments that drew starkly different portraits of him.

Not long after the verdict came down, Musk took to Twitter — the bully pulpit he now owns — to celebrate.

“Thank goodness, the wisdom of the people has prevailed!” Musk tweeted.

Musk’s decision to break away from his other responsibilities to sit in on the closing arguments even though he didn’t have to be there may have had an impact on the jurors, said Michael Freedman, a former federal prosecutor who is now in private practice working for a law firm that has represented celebrities and business executives.

“It shows he has a presence,” Freedman said.

Nicholas Porritt, an attorney who represented aggrieved Tesla investors, said he was disappointed after urging the jurors in his closing arguments to rebuke Musk for reckless behavior that threatened to create “anarchy.”

“I don’t think this is the kind of conduct we expect from a large public company,” a downcast Porritt said after discussing the verdict with a few jurors who gathered to talk to him. “People can draw their own conclusion on whether they think it’s OK or not.”

During their discussion with Porritt, the jurors told them they found Musk’s testimony that he believed he had lined up the money from Saudi Arabia’s Public Investment Fund without a written commitment to be credible. They also expressed doubt about whether Musk’s tweeting was the sole reason for the swings in Tesla’s stock price during a 10-day period in August 2018 covered in the case.

The trial pitted Tesla investors represented in a class-action lawsuit against Musk, who is CEO of both the electric automaker and the Twitter service he bought for $44 billion a few months ago.

Shortly before boarding his private jet on Aug. 7, 2018, Musk tweeted that he had the financing to take Tesla private, even though it turned out he hadn’t gotten an iron-clad commitment for a deal that would have cost $20 billion to $70 billion to pull off. A few hours later, Musk sent another tweet indicating that the deal was imminent.

Musk’s integrity was at stake at the trial as well part of a fortune that has established him as one of the world’s richest people. He could have been saddled with a bill for billions of dollars in damages had the jury found him liable for the 2018 tweets that had already been deemed falsehoods by the judge presiding over the trial.

That determination, made last year by U.S. District Judge Edward Chen, left the jury to decide whether Musk had been reckless with his tweeting and acted in a way that hurt Tesla shareholders.

“It may have not been that difficult for the jury,” Freedman said, “because it sort of became like an up-or-down vote.”

Earlier Friday, Musk sat stoically in court during the trial’s closing arguments while he was both vilified as a rich and reckless narcissist and hailed as a visionary looking out for the “little guy.”

Over the course of a one-hour presentation, Porritt had implored the jurors to rebuke Musk for his “loose relationship with the truth.”

“Our society is based on rules,” Porritt said. “We need rules to save us from anarchy. Rules should apply to Elon Musk like everyone else.”

Alex Spiro, Musk’s attorney, conceded the 2018 tweets were “technically inaccurate.” But he told the jurors, “Just because it’s a bad tweet doesn’t make it a fraud.”

During roughly eight hours on the stand earlier in the trial, Musk insisted he believed he had lined up the funds from Saudi Arabia’s Public Investment Fund to take Tesla private after eight years as a publicly held company. He defended his initial August 2018 tweet as well-intentioned and aimed at ensuring all Tesla investors knew the automaker might be on its way to ending its run as a publicly held company.

“I had no ill motive,” Musk testified. “My intent was to do the right thing for all shareholders.”

Spiro echoed that theme in his closing argument.

“He was trying to include the retail shareholder, the mom and pop, the little guy, and not seize more power for himself,” Spiro said.

Porritt, meanwhile, scoffed at the notion that Musk could have concluded he had a firm commitment after a 45-minute meeting at a Tesla factory on July 31, 2018, with Yasir al-Rumayyan, governor of Saudi Arabia’s wealth fund, given there was no written documentation.

In his 90 minute presentation, Spiro emphasized Musk’s track record helping to start and run a list of companies that include digital payment pioneer PayPal and rocket ship maker SpaceX, in addition to Tesla. The automaker based in Austin, Texas, is now worth nearly $600 billion, despite a steep decline in its stock price last year amid concerns that Musk’s purchase of Twitter would distract him from Tesla.

Recalling Musk’s roots as a South African immigrant who came to Silicon Valley to create revolutionary tech companies, Spiro described his client “as the kind of person who believes the impossible is possible.”

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Colorado River settlement center of new Navajo Nation push...

Associated Press

Tribes say their future is at stake as they push for Congress to consider Colorado River settlement

Navajo officials are celebrating the signing of legislation outlining a proposed Colorado River settlement that would ensure water rights.

7 hours ago

Arizona doctors California abortions...

Associated Press

Arizona doctors can come to California to perform abortions under new law signed by Gov. Newsom

Arizona doctors can temporarily come to California to perform abortions for their patients under a new law signed by Gov. Gavin Newsom.

1 day ago

Father convicted of first-degree murder in northern Arizona...

Associated Press

Arizona man convicted of first-degree murder in starvation death of 6-year-old son

A northern Arizona father was convicted of first-degree murder Thursday in the 2020 starvation death of his 6-year-old son.

1 day ago

Former President Donald Trump sits in a courtroom next to his lawyer Todd Blanche before the start ...

Associated Press

Trump hush money trial enters new phase after defense rests without testimony from former president

Donald Trump's hush money trial is now closer to the moment when the jury will begin deciding the former president's fate.

3 days ago

UoA student convicted of first-degree murder after killing professor...

Associated Press

Former Arizona grad student convicted of first-degree murder in 2022 shooting of professor

A former University of Arizona grad student was convicted of first-degree murder after fatally shooting a professor on campus two years ago.

3 days ago

Rudy Giuliani bankruptcy filing defamation lawsuit...

Associated Press

Ex-NYC Mayor Rudy Giuliani, Arizona’s Kelli Ward plead not guilty in fake elector case

Giuliani appeared remotely for the arraignment that was held in a Phoenix courtroom. His trial will take place in October.

4 days ago

Sponsored Articles

...

Sanderson Ford

3 new rides for 3 new road trips in Arizona

It's time for the Sanderson Ford Memorial Day sale with the Mighty Fine 69 Anniversary, as Sanderson Ford turned 69 years old in May.

...

Collins Comfort Masters

Here’s how to be worry-free when your A/C goes out in the middle of summer

PHOENIX -- As Arizona approaches another hot summer, Phoenix residents are likely to spend more time indoors.

...

DESERT INSTITUTE FOR SPINE CARE

Desert Institute for Spine Care is the place for weekend warriors to fix their back pain

Spring has sprung and nothing is better than March in Arizona. The temperatures are perfect and with the beautiful weather, Arizona has become a hotbed for hikers, runners, golfers, pickleball players and all types of weekend warriors.

Jury: Musk didn’t defraud investors with 2018 Tesla tweets