Elon Musk was found not guilty of fraud by a jury after a series of tweets in 2018 in which he claimed to have "funding secured" to take Tesla private. Tesla's stock price fluctuated dramatically as a result of the tweets. Shareholders filed a lawsuit against Musk, alleging he acted recklessly.
"Thank goodness, the wisdom of the people has prevailed!" Musk took to Twitter following the verdict on Friday. "I am deeply appreciative of the jury's unanimous finding of innocence in the Tesla 420 take-private case."
What did Musk say on Twitter?
Musk tweeted on August 7, 2018, that he was considering taking Tesla private at $420 (€388) per share, which was roughly 23% higher than the previous day's closing price.
Musk tweeted that "funding secured" and said the next day that "investor support is confirmed."
This caused the stock price to skyrocket, but when it became clear that the rumoured buyout would not take place, the share price plummeted once more.
The US Securities and Exchange Commission alleged in a separate lawsuit against Elon Musk that the billionaire rounded up the alleged buyout price to $420 per share because he had recently learned about the number's "significance in marijuana culture" and thought his girlfriend would find it funny.
Musk's lawyer, Alex Spiro, stated that the tweet was "technically inaccurate" but added that "a bad tweet doesn't make it fraud."
"The whole case is built on bad word choice," he explained. "Who cares about bad word choice?"
What were the shareholders' reactions?
Tesla shareholders hired an economist who estimated investor losses of up to $12 billion. "We are disappointed with the verdict and are considering next steps," said Nicholas Porritt, a shareholder lawyer.