Musk sued!!!! Tesla Inc Chief Executive Elon Musk is sued by a shareholder who accused him of violating his 2018 settlement with the U.S. Securities and Exchange Commission over his Twitter use.
According to a complaint filed in Delaware Chancery Court, Musk’s “erratic” tweets along with the failure of Tesla directors to ensure he complied with the SEC settlement have exposed shareholders to billions of dollars of losses. The complaint highlighted several tweets of Musk including his assessment last May 1 that Tesla’s stock price was “too high,” prompting a more than $13 billion tumble in Tesla’s market value.
Chase Gharrity, the plaintiff, told that it is Musk’s actions and the directors’ inaction that have caused “substantial financial harm” and demanded to pay damages to Palo Alto, California-based Tesla for breaching their fiduciary duties. The lawsuit was filed after Tesla’s share price has soared nearly five fold since Musk’s “too high” tweet, giving Tesla a valuation well above $600 billion. However, the SEC has not publicly accused Musk of recent violations.
Musk and Tesla each paid $20 million in civil fines. Besides this, the Tesla lawyers agreed to vet some of Musk’s tweets in advance.