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Elon Musk takes stand in Tesla tweet fraud trial

Photo: Reuters

January 23 | By AFP | Glenn Chapman |

Tesla CEO Elon Musk took the stand in a California fraud trial on Friday, accused of lying in tweets about taking the auto company private, punishing investors.

Musk was called to testify by lawyers for angry investors who accuse him of costing them millions of dollars in 2018 with untrue tweets about having funding secured to buy out shareholders at $420 a share.

The multi-billionaire’s tweets sent the Tesla share price on a rollercoaster ride and Musk was sued by shareholders who say the tycoon acted recklessly in an effort to squeeze investors who had bet against the company.

Musk, who bought Twitter itself in October, downplayed the power of his tweets noting under questioning that he once posted that he thought Tesla share price was too high, and “it went higher, which is counter-intuitive.”

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“What I’m trying to say is that the causal relationship is clearly not there simply because of a tweet,” Musk said in a testimony that lasted only thirty minutes and was to be continued on Monday.

The hearing on Friday began with Harvard law and business professor Guhan Subramanian, who was called as an expert witness by the plaintiffs.

He called Musk’s tweeted proposal to take Tesla private as “illusory” and “just wrong” in how it deviated wildly from the way such mega-deals usually take place.

“All I can say is this is just wrong; as a matter of deal process… this isn’t correct,” Subramanian said while being questioned by a defense lawyer about Musk’s tweets.

‘Reckless’ words

Testimonies in the trial opened Wednesday with a lawyer for the upset investors telling jurors Musk lied about having funding in place.

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Nicholas Porritt, who represents lead plaintiff Glen Littleton and other Tesla investors, said the tweets cost “regular people” to lose “millions and millions of dollars.”

Called as the first witness, 71-year-old Littleton told jurors he was heavily invested in Tesla in 2018 in a way that banked on the share price climbing to $500 or more.

Littleton testified that he was “pretty shocked” by Musk’s tweet about taking the company private at $420 a share because it threatened almost all the money he had invested in Tesla.

“It was going to pretty much wipe me out,” Littleton said.

Littleton told jurors he scrambled to save what he could of his investments, getting out of most of his positions at a huge loss.

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Musk is expected to continue testifying at trial on Monday, when his lawyers will get a chance to refute the accusation that he was being deceitful.

The case revolves around a pair of tweets in which Musk said “funding secured” for a project to buy out the publicly traded electric automaker, then in a second tweet added that “investor support is confirmed.”

Porritt told jurors that Musk had selected the $420 share price in the tweet “as a joke” and that the funding to take Tesla private was never locked in, nor credibly pursued.

In his own opening remarks, Musk attorney Alex Spiro said that even though the tweets may have been a “reckless choice of words”, they were “not fraud, not even close.”

The fraud trial is expected to last three weeks.

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International

Mexico requests extradition of ‘Mini Lic’ for murder of journalist Javier Valdez

The Mexican government has requested the extradition of Dámaso López Serrano, a former high-ranking member of the Sinaloa Cartel, who is accused of masterminding the 2017 murder of Mexican journalist Javier Valdez, the Attorney General’s Office announced on Tuesday.

López Serrano, known as “Mini Lic,” was arrested last Friday in Virginia, United States, on charges of fentanyl trafficking, a crime he committed while on parole.

“This is the key issue for us, he [López Serrano] is the mastermind of this murder. The rest of the perpetrators are already processed and in jail, he was the one missing,” said Attorney General Alejandro Gertz.

“We immediately made the extradition request,” the official added during the routine morning press conference of President Claudia Sheinbaum.

Valdez, an award-winning reporter specializing in drug trafficking and correspondent for AFP and the newspaper La Jornada, was murdered on May 15, 2017, in front of the office of his magazine Riodoce in Culiacán, the capital of Sinaloa state.

“Mini Lic” was originally arrested in 2017 when he voluntarily turned himself in to U.S. authorities and pleaded guilty to trafficking methamphetamine, heroin, and cocaine. In 2022, he was released on parole.

Gertz confirmed that the Mexican Attorney General’s Office had requested López Serrano’s extradition “countless times,” but Washington had declined to act on the request because he had become a “protected witness” for the U.S. government and “was providing a lot of information.”

“Now, with this situation where they themselves are acknowledging that this individual is still committing crimes, I think there are more than enough reasons for them to support us,” the prosecutor added.

The Sinaloa Cartel is one of the largest drug trafficking organizations in Mexico and was founded by Joaquín “El Chapo” Guzmán, who is serving a life sentence in the United States.

Culiacán has been shaken by a wave of murders since the arrest of Ismael “Mayo” Zambada, another key leader of the cartel alongside Guzmán, on July 25 in New Mexico, United States.

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International

Cuba’s government stresses openness to serious, respectful U.S. relations

Cuba reiterated on Tuesday its willingness to engage in dialogue with the United States, just weeks before Republican President Donald Trump assumes office. During his first term, Trump halted the historic rapprochement between the two countries, which had been initiated just ten years earlier by Democrat Barack Obama.

“It will not be Cuba that proposes or takes the initiative to suspend the existing dialogues, to suspend the existing cooperation. Not even the discreet exchanges on some sensitive issues,” said Cuban Deputy Minister of Foreign Affairs Carlos Fernández de Cossío at a press conference in Havana.

“We will be attentive to the attitude of the new government, but Cuba’s stance will remain the same as it has been for the last 64 years. We are willing to develop a serious, respectful relationship with the United States, one that protects the sovereign interests of both countries,” he added.

His statements come on the occasion of the tenth anniversary of the historic rapprochement announcement between Washington and Havana.

On December 17, 2014, Cuban leader Raúl Castro (2006-2021) and Barack Obama (2008-2016) announced the beginning of a thaw in relations, which led to the restoration of diplomatic ties in 2015, after more than half a century of confrontation.

This process of thawing bilateral relations was later halted by businessman Donald Trump, who significantly reinforced economic sanctions against the communist-ruled country. The Republican will return to the White House on January 20.

Cuba, under a U.S. trade embargo since 1962, was re-listed in 2021 on the “blacklist of countries supporting terrorism,” blocking financial and economic flows to the island of 10 million inhabitants.

Subsequently, the administration of current Democratic President Joe Biden made only slight adjustments to the sanctions and also kept Cuba on this list. However, his administration resumed bilateral contacts with Havana on migration issues and the fight against terrorism.

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International

Mexican government to use church atriums for gun surrender program to combat violence

The atriums of Mexican Catholic churches will be used for the voluntary surrender of weapons in exchange for economic and legal incentives as part of a plan announced on Tuesday by the government to reduce violence.

According to the Mexican government, there is a link between the illegal trafficking of weapons—almost entirely coming from the United States—and the spiral of criminal violence that has plagued the country since late 2006, when a controversial military anti-drug offensive was launched.

“The idea is to set up areas in the church atriums where people can voluntarily surrender their weapons, and in return, they will receive financial resources based on the weapon they are turning in,” explained President Claudia Sheinbaum during her regular press conference.

The left-wing leader emphasized that the program, called “Yes to Disarmament, Yes to Peace,” guarantees that those who surrender their weapons will not face any “investigation.”

“What we want is to disarm. This will be implemented next year. We also did it in Mexico City, and it had significant results,” added the former mayor of the capital, with a population of 9.2 million.

The disarmament plan is part of the government’s “comprehensive security strategy,” one of whose pillars is promoting a culture of peace, especially in regions severely affected by organized crime violence, Sheinbaum pointed out.

More than 450,000 people have been murdered in Mexico since the government launched its military-led anti-drug operation, alongside about 100,000 people who have gone missing.

Despite being a secular state, the Mexican Catholic Church has played a key role in efforts to contain violence, with priests acting as mediators between citizens and criminals. Several clergy members have been killed for this cause.

Just last week, the Catholic hierarchy called on cartels to declare a truce in their violent actions during the celebration of the Virgin of Guadalupe on December 12 and the upcoming Christmas holidays.

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