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On Friday, the chairman of the board of Tesla Inc. defended the company’s CEO, Elon Musk, in a securities fraud trial, and told a jury that she would resign as a director in 2018 if Musk thought he had tweeted. “Funded” to take Tesla private.
Tesla’s board chairman, Robin Denholm, is a defendant in the suit along with Musk, Tesla and other directors. Investors lost billions of dollars due to Musk on August 7, 2018, tweeting that he was “cashed in” and “investor support confirmed” to take Tesla private at $420, up about 23% from the previous day’s close.
Initially, Tesla’s stock rose and fell as it became clear that the acquisition was not going to happen. In the year At the time of the 2018 tweets, Denholm was chairing Tesla’s audit committee, which oversees the company’s compliance with safety regulations.
She stood for about 30 minutes on Friday, saying she would have left the tweets if she thought they contained misinformation. She added: “If I believed that Elon was trying to mislead the public, I would have stood down from the board.”
She took over as chairman of the board in 2015. After he agreed to step down from the role in 2018 under a settlement with the U.S. Securities and Exchange Commission, the tweets were allegedly falsified.
He and Tesla paid a $40 million fine to settle the lawsuit. They did not believe their guilt. Denholm said that as the buyer, Musk was free to tweet about the deal.
Citing Tesla’s policy, which requires pre-screening by the company, the insiders said, “Because he’s tweeting under his own name, the policy doesn’t apply.” It must be confirmed by the company first. Musk told the jury earlier this week that he could get help from existing Tesla investors as well as a Saudi sovereign wealth fund.
“The money was not the problem,” Musk told the jury. “It was quite the opposite.” Musk, however, acknowledged that he did not have binding agreements with investors for specific amounts, leaving it up to a jury to determine whether he misled shareholders.
The Silver Lake company’s chief executive, Egon Durban, said earlier on Friday that he had advised Musk on the take-home proposal, but there were doubts whether the transaction could go ahead. Investors were interested but had no written commitment, he said.
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