Elon Musk's Lawyers Seek to Transfer Trial to Texas Due to 'Local Negativity'

Tesla and Elon Musk's attorneys have asked a federal judge in San Francisco to move or delay an upcoming trial to Western Texas, citing concerns about finding unbiased jurors in Northern California. The attorneys noted "local negativity" toward Musk as a factor in their request.

‍
Musk and other current and former Tesla board members will go before a jury in a shareholder class action lawsuit. The lawsuit claims that Musk manipulated Tesla's stock in 2018 when he tweeted that he was considering taking the electric vehicle company private at $420 per share. The lawsuit alleges that Musk did not have "funding secured" to do so.

‍
Tesla's stock trading was initially halted after Elon Musk's tweets about taking the company private. However, shares have been highly volatile in the weeks since, with some investors betting on the stock's continued success and others selling off their positions. In 2020, Musk moved his residence to Texas, and in 2021 his electric vehicle company Tesla relocated its headquarters to Austin. In 2022, a judge ruled that Elon Musk's statements in 2018 were false and that he tweeted them knowingly.

‍
The trial and jury will decide whether Musk's tweets impacted Tesla's share price and whether the company or its directors should pay damages.
In a motion to transfer venue, attorneys representing Tesla and Musk argue that the CEO has garnered extensive and negative publicity in California after taking over a San Francisco-based social media company, Twitter. Musk's attorneys argue that the negative publicity he has received makes it difficult for him to get a fair trial in California.

‍
Musk has been CEO of Twitter since the deal closed, and has cut thousands of employees in a series of chaotic firings and layoffs. At a recent public appearance in San Francisco, Musk was booed after comedian Dave Chappelle invited him on stage. Quinn Emanuel Urquhart & Sullivan partner Alex Spiro argued in a recent filing that he has represented Musk in several court matters.

‍
"Many members of the jury pool in this district are likely to have a personal and material bias against Mr. Musk as a result of recent layoffs at one of his companies. Individual prospective jurors - or their friends and relatives - may have been personally impacted by the layoffs, and the negative and inflammatory local publicity surrounding the events has only served to reinforce and expand the existing bias."

‍
Spiro said in the filing that the "negativity toward Mr. Musk was not isolated to the press." He said there are regular protests and picketing activity in front of Musk's offices in San Francisco, adding that some are "endorsed and encouraged by local political figures."

‍
Musk and his attorneys have argued that his statements about a possible take-private deal for Tesla in 2018 did not violate the law.
Tesla CEO Elon Musk has claimed that he made a handshake deal with investors from Saudi Arabia’s Public Investment Fund to take Tesla private at $420 per share. However, text messages revealed in another trial in 2022 suggested that Saudi PIF investors had not fully agreed to fund a Tesla deal.

‍
This month, court filings in the securities class action showed that Musk's attorneys had subpoenaed four people who help run the Saudi Public Investment Fund to testify in this trial. These individuals include Naif Al Mogren, Saad Al Jarboa, Turqi Alnowaise, and Yasir Al-Rumayyan.