Elon Musk has been commenting for more than 3 hours, arguing with a lawyer at his Tesla trial when the judge said one of his remarks was “inappropriate”.
Elon Musk has returned to federal court to defend himself against a class-action lawsuit alleging he misled Tesla shareholders with a tweet about an aborted acquisition that the billionaire defiantly claimed he had on Tuesday he could pass if he wanted.
Musk spent about three more hours on the witness stand in his third day of testimony before being pardoned by US District Judge Edward Chen. Musk, 51, is unlikely to be called to the witness stand again during a civil trial that is expected to go to a nine-person jury in early February.
Musk, who also owns Twitter while remaining at the helm of Tesla, spent much of Tuesday portraying himself under questioning from his own lawyer, Alex Spiro, as an impeccably trusted business leader capable of making so much money that he needs to follow his visions. He fought irritably with a shareholder lawyer, Nicholas Porritt, who had raised his anger early in the process.
At two separate points on Tuesday, under Spiro’s gentle prodding, Musk made no bones about his disdain for Porritt with a remark expressing doubt that the lawyer was looking out for shareholders’ best interests. of Tesla. The remarks were quickly reprimanded by the judge and expunged from the record. “This is inappropriate,” Chen Musk once warned.
When questioned by Porritt, Musk deliberately avoided his lawyer’s gaze and made his statements while looking directly at the jury seated a few yards to his right. In another case, Musk alleged without elaborating that a question from Porritt, in which he asked if he had ever caused losses to investors, contained “untruths.”
On the other hand, Spiro once misaddressed Musk as “Your Honor” while asking the billionaire how much money he made for investors during his career. The slip sparked a moment of hilarity in the San Francisco courtroom, which was packed with media and onlookers for Musk, who has become even more famous since completing his $44 billion purchase of Twitter in October.
The current trial hinges on whether two tweets Musk posted on August 7, 2018 harmed Tesla shareholders during a 10-day period before his admission that the planned acquisition would not go through from him. The statements led to Musk and Tesla reaching the $40 million settlement without admitting any wrongdoing.
In the first tweets of 2018, Musk explained “Guaranteed financing” for a $72 billion purchase of Tesla – or $420 a share – at a time when the electric car maker was still struggling with production issues and was worth far less than it is today. Musk followed up a few hours later with another tweet indicating that a deal was imminent.
After those tweets, Musk declared that Tesla would go public a few weeks later. A month later, Musk and Tesla reached a $40 million settlement with securities regulators who claimed the tweets were misleading.
Musk has previously claimed that he entered into the settlement under duress and maintained that he never wavered in his belief that he had the money for a deal.
Musk spent most of Tuesday convincing the jury that there was nothing sneaky about the two tweets, suggesting he had earmarked the money to take Tesla private as the electric car maker struggled with production problems and it was much less expensive than it is now. The judge has already ruled that the jury could find those two tweets false, leaving it up to them to determine whether Musk intentionally misled investors and whether his statements caused them to suffer losses.
While being controlled by Spiro, Musk told jurors that he only said he was “considering” buying Tesla, but never promised to go through with a deal. But Musk said he thinks it’s important for investors to know that Tesla may be ready to end its eight-year run as a public company.
“I had no ulterior motive,” Musk said. “My intention was to do the right thing for all shareholders.”
While grilled by Porritt the day before, Musk was sometimes combative, exasperated and angry. Throughout the day, Musk insisted he had secured financial backing for a $72 billion buyout of Tesla in meetings with officials from Saudi Arabia’s Public Investment Fund, although no specific amount or price was discussed. of financing.
When presented with texts and emails showing that an official of the Saudi fund never pledged money to buy a Tesla outright, Musk claimed they were nothing more than the words of someone trying to buy one to retire from. previous commitments from private discussions.
Shortly after Porritt resumed his questioning on Tuesday, Musk hit back at the idea that his belief that he had the financial backing of Saudi funding was not enough to tweet about a potential purchase of ‘ Tesla.
“We’re talking about the Kingdom of Saudi Arabia,” Musk testified. “You can buy a Tesla multiple times. That wasn’t a lot of money for her.”
Musk also reiterated earlier statements that he could finance a Tesla purchase by sharing some of his interests in SpaceX, a private rocket ship manufacturer he also founded. This would be similar to the purchase of Twitter that led it to sell about $23 billion of its Tesla stock.
It’s something Musk said Tuesday he didn’t want to do, but it showed he had the means to comparison shop for expensive stores. Musk’s ownership of Twitter has also been unpopular with Tesla shareholders, who worry he will be a distraction as the automaker faces more competition. Tesla stock has lost about a third of its value since Musk took over Twitter.
Despite this decline, the stock is still worth about seven times what it was at the time of Musk’s 2018 tweets, taking into account the two splits that have occurred since then. That opened the door for Musk to remind jurors on Tuesday that any investor holding Tesla stock in August 2018 would have done “extremely well” if he had just held the stock.
“It would have been the best investment in the stock market,” Musk said.
Learn how to navigate and build trust in your organization with The Trust Factor, a weekly newsletter that explores what leaders need to succeed. Register here.