A federal judge in California has rejected a request from shareholders in a lawsuit to force Elon Musk stop talking about his 2018 tweets in which he said he had the funding to make Tesla a private company.
The ruling by U.S. District Judge Edward Chen Wednesday came just hours after the Tesla CEOB次元官网网址檚 lawyer filed a document in the case saying that a gag order would trample on MuskB次元官网网址檚 free speech rights.
Lawyers for the shareholders have argued that Musk is trying to influence potential jurors before the lawsuit comes to trial on Jan. 17. The lawsuit contends that the CEOB次元官网网址檚 August 2018 tweets were written to manipulate TeslaB次元官网网址檚 stock price, costing shareholders money.
Chen confirmed in an order Wednesday that he has ruled that MuskB次元官网网址檚 2018 tweets about having the money to take Tesla private at $420 per share were false.
But he wrote that one of the shareholders who pursued the gag order in the class-action lawsuit failed to prove his case. Chen wrote that the trial has been rescheduled for early next year, and that publicity during or just before a trial is a larger concern. He also wrote that the jury would be drawn from a large metro area, and that MuskB次元官网网址檚 comments are consistent with public positions in another related court case.
Lawyers for the plaintiffs also argued that Musk violated an October 2018, court settlement with U.S. securities regulators. Musk signed the agreement to pay a $20 million fine and not make any statements denying the securities fraud allegations. Musk is challenging the agreement, saying it is unconstitutional.
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The ruling comes about a week after Musk, the worldB次元官网网址檚 richest person, made a controversial offer to take over Twitter and turn it into a private company with a $43 billion offer that equals $54.20 per share. TwitterB次元官网网址檚 board on Friday adopted a B次元官网网址減oison pillB次元官网网址� strategy that would make it prohibitively expensive for Musk to buy the shares.
At issue is MuskB次元官网网址檚 April 14 interview at the TED 2022 conference, where he said that he did have funding secured to take Tesla private in 2018. He called the Securities and Exchange Commission a profane name and said he only settled the case because bankers told him they would stop providing capital if he didnB次元官网网址檛, and the Austin, Texas-based Tesla would have gone bankrupt.
Lawyers for the shareholders say MuskB次元官网网址檚 comments in the interview were an B次元官网网址渦nsubtle attempt to absolve himself in the court of public opinionB次元官网网址� over misrepresentations made with his Aug. 7, 2018 tweets.
But Musk attorney Alex Spiro wrote in his response that the shareholders didnB次元官网网址檛 show that MuskB次元官网网址檚 speech presented a B次元官网网址渃lear and discernable dangerB次元官网网址� that the whole community would be corrupted by pretrial publicity, or that finding 12 objective jurors would be impossible.
His motion says that Musk is in the middle of a public offer to take over Twitter, which has led to debate over censorship. Reporters, he wrote, have compared this to MuskB次元官网网址檚 previous statements about taking Tesla private.
During the TED interview, Musk was asked if funding was secured for the Twitter deal, a reference to the 2018 Tesla tweets. B次元官网网址淢r. Musk should be permitted to respond meaningfully and truthfully to inquiries such as this, and not be compelled to remain silent,B次元官网网址� Spiro wrote.
If Musk violated the SEC agreement, the agency can ask a judge to scrap it and restore the securities fraud complaint. The SEC wouldnB次元官网网址檛 comment.
THE ASSOCIATED PRESS
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