FILE PHOTO: Tesla CEO Elon Musk is questioned by his attorney Alex Spiro during a securities-fraud trial at federal court in San Francisco, California, U.S., January 23, 2023 in this courtroom sketch. REUTERS/Vicki Behringer
Elon Musk settled into a San Francisco courtroom and had a laugh before closing arguments began in the trial over whether his 2018 tweets defrauded Tesla Inc. investors.
Before the jury arrived Friday, lawyers for the opposing sides were arguing to US District Judge Edward Chen, whose question about whether it’s "metaphysically possible” for plaintiffs to prove a "material misrepresentation” prompted Musk to laugh out loud.
The levity didn’t last long. Minutes later, a lawyer for the investors sternly told the jury that Musk’s out-of-the-blue tweets in August 2018 about taking the electric-car maker private with "funding secured” broke basic rules that apply to how every public company communicates with the market.
"This case is about whether rules that are applied to everyone should also be applied to Elon Musk,” said attorney Nicholas Porritt. "Billionaires don’t get to operate under a different set of rules.”
Jurors have heard weeks of testimony about whether Musk’s tweets amount to securities fraud, and whether he should be held liable for potentially billions of dollars in damages.
Investment banking witnesses previously testified that even a week after the tweets, they were still working to figure out how the deal would be structured, including who would pay for it.
Musk’s central defense is that he knew he could raise as much as $60 billion to take Tesla private based on a handshake deal with Yasir Al-Rumayyan, the governor of Saudi Arabia’s Public Investment Fund.
The CEO spent a little more than two days on the witness stand, telling jurors that his "funding secured” tweet was "absolutely truthful,” and that he had an "unequivocal” commitment by Saudi Arabia even though he had nothing in writing.
