SAN FRANCISCO (AP) — A federal judge on Friday denied Tesla CEO Elon Musk’s bid to move or delay a trial over a misleading tweet about a potential acquisition of the electric car maker, setting the mercurial billionaire’s path into legal drama. . Amidst the turmoil of his Twitter takeover.
U.S. District Judge Edward Chen made the decision during a hearing in San Francisco federal court to discuss the final details of the trial, which is scheduled to begin Tuesday with jury selection.
Musk’s lawyers last week asked Chen to file the lawsuit in federal court in Texas, where Tesla will relocate its headquarters in 2021, alleging negative coverage of Musk. Ever since he bought Twitter for $44 billion in October, he has poisoned juries in the San Francisco Bay Area.
But Chen brushed aside those concerns on Friday, expressing confidence that an impartial jury could be selected from the region of millions. He also noted that a jury had been empaneled for the highly publicized criminal trial of former Theranos CEO Elizabeth Holmes.His transformation from Silicon Valley star to accused fraudster was the subject of an HBO documentary and a book before these proceedings began in San Jose, California.
Holmes, 38, is now serving more than 11 years in federal prison after being convicted of investor fraud and conspiracy.
Musk’s upcoming trial revolves around a civil lawsuit filed by Tesla shareholders who allege they were defrauded. n August 7, 2018 tweet he testified that he arranged financing for the Tesla buyout—a deal that never materialized and resulted in a $40 million settlement with US securities regulators.
Chen already identified Musk’s acquisition tweet as a hoax. leaving it up to the jury to decide whether it was negligent in deploying it and whether it would cause pecuniary damage to Tesla shareholders. After adjusting for two stock splits since 2018, Tesla’s stock is now worth nearly six times what Musk tweeted about the fake acquisition.
Tesla’s stock was worth even more before Musk decided to buy Twitter at a price that was far more than the company was worth even at his perceived value. Tesla shares, currently around $120, have lost about half their value since Musk took control of Twitter, partly due to investor concerns that he was spending too much time on his personal Twitter account instead of focusing on the automaker responsible for much of his fame and fortune. facing tougher competition at once.
Musk, 51, has said he will step down as soon as Twitter finds a successor as CEO, but has not set a timetable for handing over the reins. In an effort to cut Twitter’s losses and reduce the huge debt stemming from the acquisition, Musk has fired about half of the company’s employees and faced allegations that it refused to pay rent. in some offices.
Media coverage of the massive layoffs and other cuts at Twitter was one of the main reasons Musk’s lawyer, Alex Spiro, argued for the lawsuit to be changed or at least delayed until the backlash against the austerity subsides.
But lawyers representing Tesla shareholders in the case argued that Musk only blamed himself. for any negative perceptions, it is mainly due to his frequent activity on Twitter, the social media platform he currently owns and operates.
“For better or worse, Musk is a celebrity who commands media attention around the world,” the shareholders’ lawyers wrote in their 19-page objection to the transfer request. “His Twitter footprint alone is partly to blame for this. If only “negative” attention was required to disqualify a jury, Musk could not effectively be tried before a jury for his ability to attract “negative” coverage.”
After reviewing nearly 200 grand jury questionnaires filed earlier this week, Spiro argued that many of them were filled with disparaging remarks that underscored how difficult it would be to get a fair trial of Musk.
Some of those indecent statements came up during Friday’s hearing as Chen reviewed questionnaires in preparation for Tuesday’s jury selection. The judge disqualified the jurors, who he said variously described Musk as a “stupid” and a “joke.”