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The Musk trial opens a peephole into the often inscrutable mind of the Tesla CEO

The trial, centered around a couple of tweets announcing that Musk got the money to take Tesla private in 2018, dragged the 51-year-old billionaire into a federal courtroom in San Francisco for three days of testimony that opened a peephole into his often inscrutable mind.

Moss, who now owns the Twitter service which he uses as a bullhorn, was often a study in contrasts during his approximately eight hours on the witness stand. The electric carmaker’s CEO is facing a class action lawsuit filed on behalf of Tesla shareholders after Musk tweeted about a takeover of the company that didn’t go through.

Through both his testimony and the evidence presented to that effect, Musk came across as impetuous, brash, combative, and dismissive of anyone who questioned his motives as a revolutionary entrepreneur who inspired comparisons to the late Apple co-founder, Steve Jobs.

At other times, Musk seemed like the savvy visionary his backers hail: an intrepid rebel who, by his own estimates, has raised more than $100 billion from investors. They have been richly rewarded by his leadership of pioneering companies which include PayPal in digital payments, Tesla in electric vehicles and SpaceX in rockets.

“It’s relatively easy for me to get investment support because my track record is extremely good,” Musk noted wryly.

But his confidence in his abilities to get the money he wants to pursue his plans is one reason why found himself in court. The three-week trial will resume on Tuesday and go to jury deliberations by Friday.

Here’s what to know so far:


Evidence and testimony have shown that Musk had begun mulling over taking Tesla private in 2017, so he needn’t have worried about the headaches and distractions that come with running a publicly traded company.

After a July 31, 2018 meeting with a senior representative of Saudi Arabia’s sovereign wealth fund, Musk sent a letter to Tesla’s board explaining why he wanted to take the automaker private at a price of $420 a share, about 20 % higher than its share price. at the moment.

Musk was serious enough that he’d already discussed the pros and cons with Michael Dellwho had gone through the transition from public to private in 2013 when he spearheaded a $25 billion takeover of the personal computer company that bears his name, according to trial evidence.


The crux of the case hinges on an Aug. 7, 2018 tweet in which Musk said “guaranteed financing” take private Tesla. Musk abruptly posted the tweet minutes before boarding his private jet after being warned the Financial Times was about to post a story that Saudi Arabia’s Public Investment Fund had spent about $2 billion to buy a 5 percent stake in Tesla to diversify its interests beyond oil, according to his testimony.

Amid widespread confusion about who Musk is Chirping account had been hacked or was joking, Musk followed up a few hours later with another tweet suggesting that a deal was imminent.

Moss defended the initial tweet as a well-intentioned move to ensure that all Tesla investors know the automaker may be on its way to ending its eight-year run as a public company.

“I had no bad motives,” Musk testified. “My intent was to do the right thing for all shareholders.”

Guhan Subramanian, a Harvard University economics and law professor hired as an expert for shareholder lawyers, derided Musk’s method of announcing a potential buyout as an “extreme outlier” fraught with potential conflicts.

“The risk is that Mr. Musk timed his announcement of his management buyout proposal to serve his own interests rather than the interests of the company,” Subramanian testified.


There is another issue that threatens to undermine Musk’s defense. He had not blocked funding for the proposed deal or set how much it would take to make it happen, based on Musk’s testimony, other witnesses, and other evidence.

This is one of the reasons US District Judge Edward Chen ruled last year that Musk was 2018. the tweets were fake and instructed the jury to see them that way.

It has also prompted regulators to allege that Musk duped investors with tweets, resulting in a $40 million settlement with the US Securities and Exchange Commission also requiring Musk to step down as chairman of Tesla.

Chen ruled that the 2018 settlement, in which Musk acknowledged no wrongdoing and has since complained that he did, cannot be subpoenaed to the jury.

Musk testified that he believes he had secured an oral commitment to provide cash wherever needed for a Tesla takeover during a July 31, 2018 face-to-face meeting with Yasir al-Rumayyan, governor of Saudi Arabia’s wealth fund.

This was reinforced by testimony from former Tesla chief financial officer Deepak Ahuja, who was present at the discussions and took al-Rumayyan on a half-hour tour of a Tesla factory.

But a text message al-Rumayyan sent to Musk after the “funding secured” tweets made it appear that discussions of a Saudi fund financing a private takeover were preliminary.

“I would like to hear your Elon plan and what are the financial calculations for taking it,” al-Rumayyan wrote to Musk, according to a copy presented as evidence in the trial.

Musk framed al-Rumayyan’s text as an attempt to backtrack on his previous pledge. He also insisted that the Saudi fund had given an “unequivocal commitment” to finance the takeover.

Maneuver of money

After his 2018 tweets, Musk has been trying to get the money needed for the Tesla acquisition with the help of Egon Durban, co-CEO of private equity firm Silver Lake, which helped finance the Dell acquisition in 2013. Musk also enlisted Dan Dees, a top executive with Goldman Sachsan investment banking firm that had worked closely with Tesla.

In testimony, both Durban and Dees discussed efforts to raise funds for a Tesla acquisition for a wide range of potential investors which included two Chinese companies, Alibaba and Tencent, as well as Google in documents initially codenamed “Project Turbo”, then “Project Titanium”.

The takeover would require anywhere from $20 billion to $70 billion, according to the filings — funding that never came close to being raised, Durban and Dees both testified, especially as Musk scrapped a proposal to take Tesla private on Aug. 24. 2018, after consulting the shareholders.

Tesla’s shares are now worth eight times what they were then, after adjusting for two stock splits.

Musk still claims he could have gotten the money if he wanted to, and even if there was a shortfall, he could have covered any shortfall by selling part of his shares in privately held SpaceX. This is a strategy Musk used in his $44 billion purchase of Twitter, except him sold about $23 billion of its shares in Tesla.

Durban and Dees both testified that they had no doubts that the money for an acquisition could be raised, as echoed by former Tesla director Antonio Gracias.

“He’s the Michael Jordan of fundraising,” Gracias testified.