Elon Musk found not liable in Tesla fraud case

Shareholders said businessman acted recklessly in an effort to squeeze investors

Elon Musk leaves a federal courthouse in San Francisco, California. AP

A US jury on Friday found Tesla chief executive and Twitter owner Elon Musk not liable in a securities fraud case over tweets in which he said he had lined up funding to take the electric car company private.

Plaintiffs had claimed billions in damages but Mr Musk aggressively fought accusations of guilt, defending his ability to tweet broadly.

Jurors deliberated briefly over whether Mr Musk had committed fraud by posting a pair of tweets in which he said “funding secured” for a project to buy out the publicly traded electric car maker, with one of the tweets saying that “investor support is confirmed”.

Mr Musk took to his platform to express appreciation for the verdict.

"Thank goodness, the wisdom of the people has prevailed!" he wrote.

His controversial tweets from August 2018 sent the Tesla share price on a rollercoaster ride, and shareholders accused Mr Musk of acting recklessly in an effort to squeeze investors who had bet against the company.

“Ultimately, it's about whether rules that apply to everyone else should also apply to Elon Musk,” lawyer Nicholas Porritt, who represented Glen Littleton and other investors, told the nine jurors during closing arguments.

“Elon Musk published tweets that were false with reckless disregard as to their truth.”

Mr Musk said during the trial that his tweet about taking Tesla private at $420 a share was no joke and that Saudi Arabia's sovereign wealth fund had been serious about helping him do it.

The billionaire said he fired off the concerning tweets after learning of a Financial Times story about a Saudi investment fund wanting to acquire a stake in Tesla.

“To Elon Musk, if he believes it or even just thinks about it, then it's true no matter how objectively false or exaggerated it may be,” Mr Porritt told jurors.

“Whatever you think of him, this isn't a bad tweeter trial — it's a did they prove this man committed fraud trial,” Mr Musk's lawyer Alex Spiro said.

Mr Musk did not intend to deceive anyone with the tweets and had the connections and wealth to take Tesla private, Mr Spiro contended.

Agencies contributed to this report