Tesla CEO Elon Musk speaks at an event in Hawthorne, California April 30, 2015.
Patrick T. Fallon | Reuters
Attorneys for Tesla and Elon Musk are asking a federal judge in San Francisco to maneuver, or delay, a forthcoming trial from Northern California to Western Texas, saying they will not have the ability to search out unbiased jurors and citing “local negativity” toward Musk.
Musk, and other current and former Tesla board members, are set to face a jury in a shareholder class motion that claims the CEO manipulated Tesla’s stock in 2018 when he tweeted that he was considering taking his electric vehicle company private at $420 per share, and had “funding secured” to accomplish that.
Tesla’s stock trading initially halted, then shares were highly volatile for weeks after the tweets.
That 12 months, Musk resided in California and Tesla was headquartered in Palo Alto. The Tesla and SpaceX CEO moved his residence to Texas in 2020, and his electric vehicle company relocated its headquarters to Austin in 2021.
In 2022, Northern California Senior District Judge Edward M. Chen, who’s overseeing the trial, ruled that Musk’s statements in 2018 were false and that he tweeted them knowingly.
The forthcoming trial and jury will determine whether Musk’s now infamous tweets mattered to shareholders, if and the way they impacted Tesla’s share price, and whether the corporate or its directors ought to be held liable and pay damages.
In a motion to transfer venue, attorneys representing Tesla and Musk argue that the CEO has garnered extensive and negative publicity in California after taking on a San Francisco-based social media company, Twitter, in October 2022.
Musk appointed himself CEO of Twitter, and has cut hundreds of employees in a series of chaotic firings and layoffs for the reason that deal closed.
In a recent public appearance in San Francisco, Musk was booed after comedian Dave Chappelle invited him on stage.
Quinn Emanuel Urquhart & Sullivan partner Alex Spiro, who has represented Musk in several court matters, argued on this latest filing:
“A considerable portion of the jury pool on this District is more likely to hold a private and material bias against Mr. Musk because of this of recent layoffs at one among his corporations as individual prospective jurors—or their friends and relatives—could have been personally impacted. The present baseline bias has been compounded, expanded, and reinforced by the negative and inflammatory local publicity surrounding the events.”
Spiro added within the filing that the “negativity toward Mr. Musk was not isolated to the press.” He said there are regular protests and picketing activity in front of Musk’s offices in San Francisco, adding that some are “endorsed and encouraged by local political figures.”
Musk and his attorneys have previously argued that his statements a couple of possible take-private deal for Tesla in 2018 didn’t violate the law.
The Tesla CEO has repeatedly claimed that he made a handshake take care of investors from Saudi Arabia’s Public Investment Fund to take Tesla private at $420 per share. Text messages revealed in one other trial in 2022 suggested Saudi PIF investors had not fully agreed to fund a Tesla deal.
Court filings this month within the securities class motion show that Musk’s attorneys have subpoenaed 4 individuals who help run the Saudi Public Investment Fund to testify on this trial including Naif Al Mogren, Saad Al Jarboa, Turqi Alnowaise and Yasir Al-Rumayyan.
Read the filing from In Re: Tesla Inc. Securities Litigation (Case 3:18-cv-04865-EMC) here:
