Tesla Investors Are Suing Over Elon Musk's Bad Tweets

Photo: Mark Schiefelbein, AP

At what point is it time to just log the hell off?

Following news that Elon Musk may be in it again with the Securities and Exchange Commission for firing off a bad tweet, Bloomberg reported today that a group of institutional investors in Musk’s electric car company Tesla are suing to bar Musk from tweeting over “repeated misstatements” that they claim hurt shareholders and Tesla.

Per Bloomberg:

Their new lawsuit, filed in Delaware Chancery Court, seeks to permanently block Musk’s “unchecked use of Twitter to make inaccurate statements about the company,” lawyers for one of the investors, the Laborers’ District Council and Contractors’ Pension Fund of Ohio, said in a statement.

The suit follows a tweet from Musk on February 20 that claimed Tesla would produce roughly 500,000 cars this year, despite figures presented weeks earlier in a letter to shareholders that reflected a significantly lower production output.

Musk tweeted a correction hours later, claiming that he intended to say “annualized production rate at end of 2019 probably around 500k”, and that this year’s deliveries were “still estimated to be about 400k”. But the damage had evidently already been done.

According to Bloomberg, the lawsuit “complains that Musk and Tesla directors have breached their duties to investors”. The company did not immediately return a request for comment about the report.

This most recent tweet controversy has also landed Musk in hot water with the SEC. The agency is asking a judge to find Musk in contempt of a settlement with the SEC that was reached following a previous bad tweet about taking Tesla private.

The SEC claimed in court filings last month that Musk “did not seek or receive preapproval prior to publishing this tweet, which was inaccurate and disseminated to over 24 million people,” per The Wall Street Journal.

In spite of it all, Musk continues to log on. The Tesla CEO was tweeting about the recent achievements of his aerospace company SpaceX as of today and had tweeted about Tesla earlier in the week.

But considering Musk last year claimed his catastrophic “420” tweet about taking Tesla private was worth it’s $US20 million ($28 million) SEC fine, who can really say they’re surprised?

[Bloomberg]

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