A lawsuit alleging Elon Musk manipulated Tesla Inc's stock in 2018 should go to trial next week and he will be able to find unbiased jurors in San Francisco, despite local animosity, said a court filing by shareholders who are suing him for billions of dollars.
Tesla shareholders argued it would be unfair to move the
trial to Texas as requested by Musk, who has outraged many in Northern
California with the steep job cuts he ordered at Twitter, a San Francisco
company he bought in October.
"What they refer to as 'biased' coverage is, in fact,
factual reporting about his management of Twitter, Inc., and has no bearing on
the jury’s ability to render a fair verdict," said the court filing by the
shareholders.
Musk's lawyers requested on Jan. 6 that the federal judge
delay or move the trial to Texas due to media coverage of Twitter's job cuts
that was "inflammatory" compared with balanced reporting on layoffs
at other companies in the city like Lyft Inc.
Videos of an audience booing Musk during a surprise
appearance at a Dave Chappelle show in San Francisco in December were
circulated online. “It sounds like some of the people you fired are in the
audience," the comedian said in the clip.
Musk later admitted it was "a lot of boos" and
added in a now-deleted tweet: "It's almost as if I've offended SF's
unhinged leftists ... but nahhh."
Tesla moved its headquarters from the San Francisco area to
Texas in 2021.
The trial is scheduled to start on Jan. 17 and feature
testimony from Musk about his behind-the-scenes efforts in 2018 to line up
financing to buy out the electric vehicle maker.
The judge will hear arguments on the requested venue change
on Friday.
Shareholders accuse Musk of causing billions of dollars in
losses for investors by making false and misleading statements to artificially
inflate the stock price. Musk tweeted in August 2018 that he had "funding
secured" to take Tesla private, sparking 10 days of volatile trading in
its stock shares, bonds and options.
Defendants, which also include Tesla and its board at the
time, will make their case that Musk was not misleading investors in a material
way. Musk had met Yasir Al-Rumayyan, the managing director of Saudi Arabia's
sovereign wealth fund, on multiple occasions, according to the court filing,
which also said Al-Rumayyan had urged Musk to take Tesla private and offered up
to $60 billion in backing.
Al-Rumayyan is among the witnesses expected to testify along
with Oracle Corp co-founder Larry Ellison and James Murdoch, son of Fox Corp
Chairman Rupert Murdoch, according to court filings.
U.S. District Court Judge Edward Chen determined in May that
the 2018 tweets were untrue and reckless. The jury will determine if the
statements actually impacted Tesla's share prices, whether Musk acted knowingly
and whether to award damages and in what amount.
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