Tesla investors will receive their cut of $40 million plus interest as a result of Elon Musk's misleading tweets, pending court approval.
The US Securities and Exchange Commission aims to pay the investors the $40 million plus interest that Tesla’s chief executive officer and the company agreed to as civil penalties to settle a lawsuit by the regulator.
A total of 3,350 claims will be paid out of the fund set up from the settlement if the plan is approved, according to the filing. That works out to just under $12,400 an investor, on average. The judge said Thursday he would sign off on the plan on Sept. 1 if there are no objections from Tesla or Musk, the world’s richest person.
What accounts for the huge gap in estimated losses between the $80 million and the $12 billion? It’s not entirely clear, but the expert’s number applied to losses by all Tesla investors over 10 days after the Aug. 7, 2018, tweet. The SEC’s number covers just over 27 hours after the tweet, excludes options and derivative trades and applies only to Tesla common stock. And not every eligible investor filed a claim.
The investors in the class action case lost at trial in February, when the jury took just two hours to clear Musk of their claim that he defrauded them with the tweet. The case was one of the few corporate securities fraud claims to go to trial. The vast majority are thrown out or settled. In the 2018 SEC settlement, Musk and Tesla each agreed to pay $20 million in civil penalties, and that the CEO’s company-related Twitter posts would be screened by a company lawyer.
Musk and Tesla paid the money, but Musk began to chafe at the supervision of his social media posts, claiming the deal violated his right to free expression and that the SEC was harassing him. A federal appeals court in May rejected those arguments, ruling against Musk’s attempts to nullify the agreement.Read More: ‘Teflon’ Elon Wins Again as Jury Rejects Tweet Fraud Claims
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Class Action Lawsuit Filed Against Atomic Wallet After a $12 Million Loss (Report)The affected people lost anything from $150,000 to $2 million.
Read more »
Trump campaign already selling merch featuring his mug shot — including $34 T-shirtsThe products include a mug featuring his mug, as well as several T-shirts, koozies and a bumper sticker that range in price from $12 to $34.
Read more »
Trump is selling his mug shot on shirts, koozies and bumper stickersFor $34, Trump supporters can buy T-shirts featuring the first mug shot of a former American president. Bumper stickers are going for $12.
Read more »