In a recent case, investors sued Elon Musk, the CEO of Tesla, for alleged manipulation of the company’s stock price through tweets on the social media platform Twitter. In August 2018, Elon Musk tweeted that he was considering taking Tesla private at a price of $420 per share, and that funding was secured. The tweet caused a significant increase in Tesla’s stock price, leading some investors to sue Musk for artificially inflating the stock price through misleading information.
However, the case was dismissed and Elon Musk was acquitted. The jury concluded that the plaintiffs failed to provide sufficient evidence linking Musk’s tweets solely to the fluctuation of Tesla’s stock price. The defense argued that Musk’s tweets were merely his personal thoughts and not a factual announcement of the company’s plans.
As a result of the tweets, Elon Musk had previously faced legal trouble with the U.S. Securities and Exchange Commission (SEC). He was forced to step down from his role as Tesla’s chairman, pay a fine of $20 million, and have potentially market-moving tweets about Tesla reviewed by a lawyer before posting them. Despite these consequences, Elon Musk praised the “wisdom of the people” after the verdict and expressed gratitude to the jury for recognizing his innocence.
It is important to note that Elon Musk’s tweets have generated a lot of controversy in the past and continue to be a source of speculation and debate in the business and investment community. While he is widely regarded as a visionary entrepreneur and tech innovator, his public statements and behavior have also drawn criticism for being erratic and potentially damaging to his companies and investors.