Elon Musk claims that Saudi Arabia had agreed to fund a 2018 buyout of Tesla, according to a bombshell lawsuit filed late Tuesday in California federal court.
Musk lays out in detail for the first time his version of events leading to his Aug. 7, 2018, tweet that sparked a firestorm on social media — and a rap on the knuckles from federal regulators: “Am considering taking Tesla private at $420. Funding secured,” Musk tweeted that day.
The Securities and Exchange Commission charged Musk with fraud for his tweet, leading to a $20 million settlement, his stepping down as chairman of Tesla and a requirement that his tweets be vetted by company lawyers. Meanwhile, Tesla stockholders — whose shares rose about 13% in the wake of the tweet, but then fell — filed a California class-action lawsuit. They are seeking a summary judgment.
Musk argues now in response to the class-action suit that he had funding secured for a deal to take Tesla private, and so couldn’t have defrauded investors, according to the suit written by Quinn Emanuel Attorney Alex Spiro.
“Mr. Musk firmly believed funding was secured when he tweeted,” according to the suit. “Per Mr. Musk’s discussions with the Saudi Arabia sovereign fund, it was secured,” the filing claims.
Much of Tuesday’s filing, obtained by The Post, is redacted. The Saudi Arabia Public Investment Fund couldn’t be immediately reached late Tuesday.
In the suit, Musk’s attorneys claim he also approached the Tesla board pre-tweet with a $420-a-share offer — a 20% premium to where the stock was trading that day in 2018. The suit says Musk had his own financial and legal advisers working on a deal. The names of the alleged advisers are redacted from the suit.
The Financial Times reported on Aug. 7, 2018, that the Saudis had bought a nearly 5% stake in Tesla. Musk that same day posted his now-infamous $420 tweet. The Saudi fund reported that it had sold nearly all of its Tesla shares in early 2020.