Elon Musk testifies '$420' buyout tweet was no pot joke
SAN FRANCISCO - Elon Musk returned to federal court on Monday in San Francisco, testifying that his controversial tweet in 2018 where he claimed to have secured funding to take Tesla private for $420 per share was not a pot joke.
A lawyer representing Tesla shareholders asked Musk whether he "went with 420 because it was a joke your girlfriend enjoys." He replied he thinks there is "some karma" around the number 420 — which is also a reference to marijuana — although he added he doesn’t know "if it’s good karma or bad karma at this point."
He then said the number was a "coincidence" and it represented a 20% premium of Tesla’s share price at the time.
Musk testified that he believed he had locked up financial backing to take Tesla private during 2018 meetings with representatives from Saudi Arabia’s Public Investment Fund — although no specific funding amount or price was discussed.
The billionaire Tesla CEO and Twitter owner was hit with a class action lawsuit from investors alleging he misled them with a tweet saying, "Am considering taking Tesla private at $420. Funding secured." He followed that up with another tweet in which he said investors could either sell at $420 per share or hold them and go private.
The tweet resulted in a $40 million settlement with securities regulators after the deal never came close to happening.
The trial hinges on the question of whether Musk's pair of tweets damaged Tesla shareholders during a 10-day period leading up to Musk’s admission that the buyout he had envisioned wasn’t going to happen.
Speaking in a soft halting tone, Musk said Monday he "had trouble sleeping last night and unfortunately I am not at my best." He added that it was important for jurors to know that he "felt that funding was secured" due to his ownership of "SpaceX stock alone."
"Just as I sold stock in Tesla to buy Twitter. ... I didn’t want to sell Tesla stock but I did sell Tesla stock," he said of the stock sale to make up for the lack of funding from other sources for his $44 billion deal to take Twitter private. Musk sold nearly $23 billion worth of his car company’s shares between last April when he started building a position in Twitter, and December.
"My SpaceX shares alone would have meant that funding was secured," Musk said of the 2018 tweets.
Even before Musk took the stand on Friday, U.S. District Judge Edward Chen had declared that the jurors can consider those two tweets to be false, leaving them to decide whether Musk deliberately deceived investors and whether his statements saddled them with losses.
Musk has previously contended he entered into the SEC settlement under duress and maintained he believed he had locked up financial backing for a Tesla buyout during meetings with representatives from Saudi Arabia’s Public Investment Fund.
The Associated Press' Barbara Ortutay contributed to this report.