A jury in a California federal court took just an hour to deliberate before delivering its verdict in the securities fraud trial against Tesla CEO Elon Musk. The jury found Musk “not liable” for losses incurred by investors who had accused him of fraud based on tweets he sent in August 2018 claiming that he was considering taking the company private and that funding was secured.
This quick decision stands in stark contrast to other high-profile fraud trials such as those of Elizabeth Holmes and Martin Shkreli, which took days for juries to deliberate on verdicts. The speed of this decision has left some observers stunned, especially considering the magnitude of the case.
The trial, which lasted for several weeks, saw a litany of witnesses, including Musk himself, recount the events surrounding the controversial tweets from August 7th, 2018. District Court Judge Edward Chen had already instructed the jury to consider Musk’s tweet false, leaving them to decide whether he knowingly deceived shareholders, causing them to incur losses.
In his closing argument, plaintiffs’ attorney Nicholas Porritt argued that Musk needs to be held accountable for tweets that were already ruled to be false. “This case ultimately is about whether the rules that apply to everyone else should also apply to Elon Musk,” Porritt said. “Billionaires don’t get to operate under a different set of rules.”
Porritt walked the jury through the testimony of the Tesla investors who brought the lawsuit and various expert witnesses who presented data showing how fluctuations in the stock price following the August 7th tweet led to losses. He argued that Musk’s tweet was a lie, proven by text messages between the Tesla CEO and Yasir Al-Rumayyan, the governor of Saudi Arabia’s Public Investment Fund.
On the other hand, Musk’s lawyers claimed that he was guilty of nothing more than “poor word choice.” In his closing argument, attorney Todd Spiro argued that Musk tweeted “funding secured” because he believed he would have “ample funding” to take Tesla private. The tweet was “technically inaccurate,” Spiro acknowledged, but not fraud.
The jury’s decision allowed Musk to walk away unscathed, rather than paying out billions of dollars in damages. Tesla, which had consciously chosen to make Musk its public image, was also absolved of any liability.
This verdict is likely to be met with strong reactions from both sides, with some applauding the jury for its quick and unanimous decision (including Musk himself), while others decry it as an example of the unequal application of the law to the rich and powerful. Regardless, the case serves as a reminder of the incredible influence that a single tweet can have, and the responsibility that comes with the use of social media.