A court case for shareholders over Tesla tweets adds to Elon Musk’s woes

Musk was responsible for the recent layoff of around half of the Twitter workforce.

But his legendary behavior extends far beyond California, and he’s polarizing opinions.

Responses to a questionnaire filled out by would-be judges reportedly included responses such as, “I think he’s a little crazy, on a personal level,” while another described him as “not a very personable person.”

Meanwhile, the judge has already issued a pre-trial ruling that Musk’s tweets were reckless and false, and will brief the jury accordingly.

However disabled Musk is, those representing the case must convince a jury that his comments were misleading and that the tweets were material enough to move Tesla’s stock price.

Or should it be “listener caution” when it comes to interpreting throwaway or deliberate remarks from Musk.

U.S. regulators had no doubt objected to Musk’s disclosure at the time, fined him and Tesla a total of $40 million ($57 million), forced him to vacate the role of chairman, and insisted that the company will appoint two independent directors.

The trial is a showcase that will shine a spotlight on Musk’s lack of a personal filter, his disdain for regulatory disclosure rules, and obsessive overuse of his Twitter account.

At the time, the Securities and Exchange Commission said Tesla had not established any disclosure controls or procedures to determine whether Musk’s tweets contained information that would require disclosure in Tesla’s SEC filings. It also didn’t have adequate processes in place to ensure Musk’s tweets were accurate or complete.

As much as this was a PR black eye for Musk, his credentials and finances were far more damaged by last year’s Twitter acquisition.

What seemed like a horrifying takeover at the time has only gotten worse as advertisers have ditched the social media group and banks that loaned Musk $13 billion to fund the deal are reportedly preparing to take big losses .

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Musk needs a win and the only place to find one will be through Tesla.

The company has consistently beaten market estimates in the past, with deliveries in the December quarter falling short of expectations. But this time the challenges are greater. Tesla has recently reduced the prices of its electric vehicles to stimulate demand.

But the company has also had to contend with raw material cost inflation and COVID disruptions to its manufacturing in China.

However, Tesla’s stock price has defied the odds year-to-date — up more than 21 percent.

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https://www.smh.com.au/business/companies/under-siege-musk-trial-adds-to-his-mounting-misfortunes-20230118-p5cdi0.html?ref=rss&utm_medium=rss&utm_source=rss_business A court case for shareholders over Tesla tweets adds to Elon Musk’s woes

Brian Lowry

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