When Tesla CEO Elon Musk tweeted in 2018 that funding was in place to take the company private, stock prices first soared, then tumbled after the proposal fell apart. Investors took him to court in January, but after a weeks-long civil trial, the jury found Friday that Musk wasn’t liable for stock-related losses.
The case boiled down to picking apart what exactly Musk had meant. In the first tweet referenced in the trial, Musk had mentioned that he was considering taking Tesla private and said, “Funding secured.” In a second tweet he said, “Investor support confirmed” but added that the proposal would be up to a shareholder vote.
After privatizing fell apart, investors sued Musk for financial losses. During the trial, lawyers for the company and its CEO argued that though the funding tweet wasn’t accurate, it didn’t necessarily constitute fraud, according to The Washington Post.
The ruling comes after Musk and Tesla settled a 2018 lawsuit by Securities and Exchange Commission, paying $40 million and agreeing to more governance because of the “funding secured” tweet. It’s one of many instances when a tweet has gotten Musk, who now owns Twitter, in hot water.
In the investor suit resolved Friday, presiding Judge Edward M. Chen had earlier ruled that Musk’s tweet about secured funding wasn’t accurate. But it was up to the jury to decide whether the market’s response was Musk’s fault and whether he and Tesla’s board should be liable. After two hours of deliberation, the jury decided they weren’t responsible for the turmoil caused by the tweets.
Plaintiffs reportedly argued that Musk should be subject to the same financial responsibility rules as everyone else.
During closing arguments, the Post reported, Musk lawyer Andrew Spiro said, “Just because it’s a bad tweet, doesn’t mean it’s fraud.”