Tesla Inc. must face an investor lawsuit over Elon Musk’s notorious 2018 tweet about taking the electric car maker private.
The ruling means Tesla will have to provide documents and other evidence to the plaintiffs as the case moves forward. Musk will probably have to submit to a deposition. The judge’s ruling also increases the plaintiffs’ leverage in settlement talks, as investors seek billions of dollars in damages to cover their losses.
The company claimed that Musk’s Twitter post on Aug. 7, 2018 — “Am considering taking Tesla private at $420. Funding secured” — was “aspirational,” not fraudulent. But a San Francisco federal judge ruled Wednesday that shareholders’ lawsuit claiming the tweet was an intentional deception that jolted Tesla’s stock price can go forward.
“Nothing in the statement suggested it was merely aspirational,” U.S. District Judge Edward Chen wrote. “It appears factual,” and according to the complaint, “was not true,” he…