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JPMorgan sues Tesla for $ 162 million in litigation over Elon Musk tweets – Forbes France

JPMorgan |
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JPMorgan Chase is suing Tesla for $ 162 million, accusing the automaker of violating a stock warrant contract after CEO Elon Musk tweeted about the company’s privatization in 2018, the latest sequel to the social media post. social networks that saw the billionaire accused of stock fraud.

Main aspects

  • JPMorgan alleges that Tesla “flagrantly” violated the terms of a stock guarantee agreement, according to a complaint filed in the Southern District of New York.
  • According to court documents, Tesla sold stock warrants to JPMorgan in 2014 and promised to deliver shares or cash if its share price was above a set price at expiration, with provisions allowing the bank to adjust the price. in the light of major companies. transactions such as mergers or privatizations of the company.
  • JPMorgan adjusted the value of the guarantees when Elon Musk tweeted that he was considering privatizing Tesla and had “secure financing,” according to the filing, and made a further adjustment when Elon Musk returned to this idea a few weeks later.
  • When the warrants expired this year, the stock price had risen significantly and was “well above” the strike price, JPMorgan said, although Tesla “refused to settle the contractual strike price.”
  • Tesla claimed that the bank had been “unreasonably quick” and “opportunistic” in its adjustments to “take advantage of changes in the volatility of Tesla shares,” according to court documents.
  • JPMorgan said it claims the more than $ 162 million owed, along with legal expenses and costs.

The context

Elon Musk’s now-infamous tweet has caused chaos for the billionaire and for Tesla. He was sued by the Securities and Exchange Commission and charged with securities fraud “for a series of false and misleading tweets.” The regulator found that Elon Musk had not even discussed the specific terms of a deal to privatize Tesla, let alone the secured funds. Elon Musk and Tesla agreed to pay $ 20 million to settle the lawsuit. Since 2018, Elon Musk’s presence on social media has continued to attract the attention of regulators, and in 2019 the SEC clarified that Tesla must approve any tweet regarding the company’s finances or other information deemed important to the companies. investors and has repeatedly warned the company to keep its tweets. under control.

Forbes US Translated Article – Author: Robert Hart

<< Lea también: Los seguidores de Twitter de Elon Musk votan para vender el 10% de las acciones de Tesla >>>

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