back to article Er, Musk's trial hasn't stopped, no matter what he told Twitter, says judge

Elon Musk's decision this week to go ahead with his Twitter purchase – after months of trying to wriggle out of the deal – hasn't automatically stopped his upcoming trial, the judge overseeing the case said today. That suggests Musk's October 6 deposition by Twitter may go forward as scheduled. In a letter to the social …

  1. Anonymous Coward
    Devil

    Reheat the popcorn

    Elon, his rich buddies, and bankers. I can't think of a better group of people to watch being raked over the coals.

    1. Ace2 Silver badge

      Re: Reheat the popcorn

      Would you swing Elon to hit the bankers, or swing the bankers to hit Elon? I can’t make up my mind.

      1. DS999 Silver badge

        Re: Reheat the popcorn

        Can we put them all in front of a Tesla in autopilot and see if it is able to avoid them? We will need multiple trials in different lighting and weather conditions to be sure.

        1. gandalfcn Silver badge

          Re: Reheat the popcorn

          "Newly Upgraded Tesla AI Makes Fart Noise Any Time It Runs Over Child"

    2. Anonymous Coward
      Anonymous Coward

      Re: Reheat the popcorn

      The banks being on the hook is a bad thing for everyone else. They've been very unwise in going along with Musk, and it's going ot hurt them. That in turn is bad for everyone else. That money cannot be used to invest in something more sensible. Ultimately, it's the banks' other borrowers, creditors and depositors who will end up paying the price for their mistakes.

      This could also be very bad news for SpaceX. Private investment in this Musk scheme is now looking like a very bad idea. Perhaps more investment in other Musk schemes would be a bad idea. Ok, Tesla may be self-sustaining, but SpaceX is not, yet. There'll be a certain amount of reevaluation of Musk's reliability going on.

      1. MachDiamond Silver badge

        Re: Reheat the popcorn

        "The banks being on the hook is a bad thing for everyone else."

        I don't think so. If you have exposure through one of those banks, don't wait to move funds around. The banks are listed by name so it no big mystery. Draw out your funds and put them somewhere better. No point in leaving your assets with institutions that take such stupid risks with it.

        1. Michael Wojcik Silver badge

          Re: Reheat the popcorn

          If you have exposure through one of those banks, don't wait to move funds around.

          I don't, but frankly this advice is silly for typical US individuals, whose "exposure" to banks is either in small-time personal retail banking, or extremely indirectly through things like 401(k) mutual funds. In the former case, their deposits are insured by FDIC and they'll never see enough interest to matter, so it really doesn't matter what the bank does. In the latter, their exposure is highly diluted and not under their direct control.

          Switching to a different bank would just be a pointless opportunity cost and headache.

          It's possible that taking a hit from Musk's Misadventures might mean a given bank has a bit less to loan to other businesses, which could in theory hurt some small businesses here and there; but there are plenty of other lenders.

      2. gandalfcn Silver badge

        Re: Reheat the popcorn

        "The banks being on the hook " Is quite normal when you follow the shouty gob rather than common sense. IQ45 springs to mind, plus the recent crash.

        Leon is a con artist.

        1. Anonymous Coward
          Anonymous Coward

          Re: Reheat the popcorn

          Odd how the left coast elites LOVE him. They fawn over every little Tesla thing and are almost orgasmic over their solar roof tiles. Shame the cars have awful QC and that his solar is massively over priced. Maybe it is just the left coast elite 'I spent more than you, I must be SO green' attitude.

          1. Ian Johnston Silver badge

            Re: Reheat the popcorn

            What, precisely, do you mean by "elite" in this context?

            1. Anonymous Coward
              Anonymous Coward

              Re: Reheat the popcorn

              The smug dem voters who talk a lot about wanting to solve societies problems but in reality they are only interested in ensuring their money supply, one-upping against their 'friends' and paying as little as possible to their (likely undocumented) maid and gardener.

              1. JoeCool Bronze badge

                as opposed to

                The entitled gop voters who talk a lot about doing god's work but in reality they are only interested in ensuring their money supply, one-upping against their 'friends' and paying as little as possible to their (likely undocumented) maid and gardener.

                1. Anonymous Coward
                  Anonymous Coward

                  Re: as opposed to

                  I think you will find a lot of the GOP voters doing gawds work are in the flyover states doing real work and wondering how the dem protesters have so much free time to protest everything.

                  1. MrDamage Silver badge

                    Re: as opposed to

                    Given those same GOP voters have to wait a few days before the John Deere mechanic will come out (at cost) to effectively perform a capacitance reset on a tractor, I'm sure they have plenty of their own free time watching crops spoil.

              2. Michael Wojcik Silver badge

                Re: Reheat the popcorn

                The smug dem voters who talk a lot about wanting to solve societies problems but in reality they are only interested in ensuring their money supply, one-upping against their 'friends' and paying as little as possible to their (likely undocumented) maid and gardener.

                And they're in league with the bugbears under AC's bed and the vampire unicorns in the closet, too!

          2. Robert Grant

            Re: Reheat the popcorn

            I think it's just that when he joined Tesla electric cars were a crazy fantasy, and now I can drive anywhere without seeing lots of Teslas, and many other car companies' electric cars. If the only thing he ever did was that, he is about as worthy of celebration as anyone.

      3. lotus49

        Re: Reheat the popcorn

        It's not as simple as that.

        There is no reason to believe that any of that money would have found a more beneficial home, depositors can go elsewhere, creditors have themselves to blame and most of these banks aren't financed by pension funds and other borrowers can and should go elsewhere.

        Why should most of us care if Space X or Tesla for that matter go bust? I know I don't.

    3. lotus49

      Re: Reheat the popcorn

      My thoughts exactly.

      I despise Twitter and Musk and I don't have a lot of time for the banks either. I hope it ends badly for everyone concerned.

  2. Anonymous Coward
    Anonymous Coward

    Let me guess... the debt financing will shockingly, unpredictably, and totally unavoidably and in no way triggered by Musk himself, fall through?

    1. gecho

      Yeah, sounds like a delaying tactic to slow the court case, which is something he wanted from the start of litigation. If he did managed to get the case dropped or paused, there would be a problem with financing after a drawn out period of nothing happening.

      "said he would go ahead and buy Twitter after all, provided he had the debt financing in place to bankroll the acquisition and that Twitter's lawsuit against him in a Delaware court was immediately brought to a halt."

      1. gandalfcn Silver badge

        "provided he had the debt financing" or the house of cards will collapse.

    2. bazza Silver badge

      I've wondered just how watertight the deals between Musk and the banks are. He needs those deals to be totally watertight, because he in turn is personally on the hook for $44billion.

      If the banks can walk away, Musk could end up having to pay the full $44billion himself, plus whatever other damages the Chancellor sees fit to order.

      It could get very interesting if a Special Master gets involved. AFAIK, the Special Master can act in anyway they see fit in Musk's name to deliver on the court's order. Taking up those bank loans is one way of doing that. Cruicially, it's not the banks that are up before the Delaware court, it's Musk, and any orders / Special Master apply to him, and him alone. Perhaps it's possible that, if a Special Master is appointed, they may choose to not take up the bank loans, but do something like sell more of Musk's Tesla shareholdings to finance the Twitter deal.

      Option

      Perhaps the banks start playing hardball with Musk, refusing to follow through with their commitment. In that circumstance a Special Master might (in their Musk personna) look at the option of sueing the banks, and decide that selling more Tesla shares is the easier option.

      1. Anonymous Coward
        Anonymous Coward

        I think it's heading quite hard towards Musk coughing up the $1B penalty to get out of this deal (which is IMHO what all this hullabaloo is really about).

        Painful, but better to finance than the $44B of risk that the banks no longer want on their books.

        It could not have hanned to a nicer person..

        1. MachDiamond Silver badge

          "I think it's heading quite hard towards Musk coughing up the $1B penalty to get out of this deal (which is IMHO what all this hullabaloo is really about)."

          It's way past that now. The impact all of this has had on Twitter as a going concern would be hard to put a price on. A judge and/or jury would have their work cut out for them to asses what the value has been in lost talent through employees leaving. Projects that have been put on hold. Nervous advertisers. A stock on a roller coaster.

          All of the bad mouthing that Elon has been doing in direct violation of the contract he signed is also an issue. Twitter seems to have seen his abuse coming and put in that non-disparagement clause as a way of feeding Elon all he rope he wants to use to hang himself.

          If Elon were wanting to elect paying the breakup fee, the lawsuit would turn from forcing the sale to damages which might also require Elon to be deposed and either prove his allegations against Twitter or be on the hook for libel/slander. Twitter won't have to prove he's wrong, it doesn't work that way.

        2. Charlie Clark Silver badge

          The deal he signed made the USD 1 billion very unlikely and it now looks like he withheld important information during discovery, which if the judge agrees, makes the USD 44 billion + costs a certainty.

      2. MachDiamond Silver badge

        "but do something like sell more of Musk's Tesla shareholdings to finance the Twitter deal."

        The number of Tesla shares Elon owns is a matter of public record. What's harder to ascertain is how many of those shares are pledged against lines of credit and loans. I'm not sure the court could go after those shares unless Elon declares total bankruptcy. The banks that hold the shares as security might be faster to call them than a court could act. Just how many pieces are out of Elon's Jengo tower close to the base remains to be seen. It's not accurate to take his listed number of Tesla shares and multiply them by the last closing price on the stock market and call that his net worth. There's the other side of the ledger to take into account. Let's also not discount the ever increasing number of dependents and ex-wives. As a wealthy father, it's not likely the child support he must pay is in any way minimal. Membership in the Hair Club for Men must also be a fair amount.

        Will SpaceX be able to continue spending money like a drunken sailor after Elon is done paying for a non-profit social media hobby? Elon was saying that Starlink is held back by not being able to use Starship to deploy satellites and Starship is held back by not having Raptor engines that will work reliably. This means that until the Raptor engine is sorted and more testing can be done on the Starship upper stage to get it to the point where it's a working tool and not just a shell, Starlink is in trouble. If it can't start earning large amounts of money quickly, that house of cards is trembling. The Boring company has a tentative valuation that's over 10x what its brought in revenue, so that's a non-starter.

        I'm gonna need more butter for my popcorn and lots of Guinness.

        1. Anonymous Coward
          Anonymous Coward

          Yeah...

          But these are all individual businesses that can be sold off. Star link can easily be sold off if it experiences massive delays and as part of the deal SpaceX will have the contract to launch further satellites.

          It would take quite a while for an implosion to actually reach Musk himself.

          1. Anonymous Coward
            Anonymous Coward

            Re: Yeah...

            Yeah, but it would hit him where it hurts him most: his ego.

            Worth it.

          2. Missing Semicolon Silver badge
            Pirate

            Re: Yeah...

            Horror show... SpaceX sold in fire sale. Bought by Boeing.

          3. MachDiamond Silver badge

            Re: Yeah...

            "Star link can easily be sold off"

            That's highly doubtful. The system is far from complete which would mean the buyer would need to keep launching satellites. Who will they contract for that? SpaceX is an obvious choice, but they'd have to pay retail rates and currently Starlink is likely only being accounted the cost of each launch since it's a SpaceX division. Even if the accounting is "charging" Starlink retail prices for each launch, it's just a matter of switching the numbers around.

            Some of the back of the envelope estimates for the economic payback of Starlink don't show too rosy a picture. Even if those pessimists are off by an order of magnitude, they could still be correct in general. Any buyer is going to want a very detailed look at the whole operation and will make their own projections on whether the ROI makes any sense if there is one.

        2. gandalfcn Silver badge

          " What's harder to ascertain is how many of those shares are pledged against lines of credit and loans." Most of them I suggest/

  3. Anonymous Coward
    Anonymous Coward

    A perfect storm of his own making

    Musk under oath would be interesting.

    If not very confusing.

    1. Anonymous Coward
      Anonymous Coward

      Re: A perfect storm of his own making

      "Oh I didn't realise perjury was still a thing" E. Musk.

    2. Andy 73 Silver badge

      Re: A perfect storm of his own making

      It's worth searching out his statements under oath in the Solar City trial - covered in detail on YouTube. If you were in any doubt about his 'business skills' and behaviour, they lay him pretty bare.

      That said, he 'won' that case, and the embarrassing trail showing seems to have been completely brushed under the carpet, so I wouldn't count on this trial actually doing him any serious damage, financial or reputational. It turns out that if you're *that* rich, mainly with other people's money, a lot of people really, really don't want you to fail.

      1. MachDiamond Silver badge

        Re: A perfect storm of his own making

        "That said, he 'won' that case, "

        Yes, and it's up for appeal so we'll have to see what round two looks like if that happens.

        I thought they had him bang to rights. It was patently obvious that he pushed the deal to save his and his family member's investment along with the NASA money SpaceX "invested" in Solar Bonds to keep Solar City afloat. I'd love to know the reasoning behind the court's decision on that one. It's makes no sense to me.

        1. Anonymous Coward
          Anonymous Coward

          Re: A perfect storm of his own making

          If the reasoning doesn't make sense it tends to point at either poltics and/or money.

          And that's not just a US feature, although it's a lot more blatant there.

        2. Someone Else Silver badge

          Re: A perfect storm of his own making

          I'd love to know the reasoning behind the court's decision on that one. It's makes no sense to me.

          Along the same lines as the "reasoning" behind Aileen Cannon's assignment of, then hamstringing, the "Special Master" tRump solicited to review delay the DoJ's prosecution regarding the classified documents tRump illegally stashed as trophies in a drawer at Mar-a-Lago.

          1. Michael Wojcik Silver badge

            Re: A perfect storm of his own making

            Cannon didn't have much choice about the "hamstringing" after the Eleventh Circuit tore her a new reasoning-hole. They vacated not only every part of her order that the DoJ appealed,1 but essentially all of her opinion as well.

            It's not how you want to start out your career as a District Court judge.

            (And two of the judges on the Circuit panel were also Trump appointees, FWIW.)

            1It was a narrow appeal against only the part of the order that applied to the Top Secret documents, presumably to improve the DoJ's argument and chances of success, and because they didn't really care about the rest. As it happened, the part that remains in effect seems to be backfiring against the Trump camp anyway, so in a sense the DoJ won across the board.

            1. MachDiamond Silver badge

              Re: A perfect storm of his own making

              "And two of the judges on the Circuit panel were also Trump appointees, FWIW"

              Politics is much about "what can you do for me now" so those judges would only have to worry if Trump were to run again and have a strong chance of winning. I hope he doesn't, there's too great a risk that he'd hand the election to Biden on a silver platter if Joe isn't removed prior. The US is in dire need of better choices of people to put in office. The vast majority of the current crop need to be rounded up and sent to the far north for re-education.

              1. Someone Else Silver badge

                Re: A perfect storm of his own making

                [...] so those judges would only have to worry if Trump were to run again and have a strong chance of winning.

                They don't have anything to worry about; Federal judges are appointed for life, and their pay cannot be reduced, per the US Constitution.

                Now, if tRump were to suspend the Constitution, that would be a whole 'nother thing. I don't think the judges worry would be about tRump, but more like, the future of the country -- much like the rest of us.

    3. MachDiamond Silver badge

      Re: A perfect storm of his own making

      "Musk under oath would be interesting."

      He's something of a dick. The transcripts from his deposition in the Solar City Bailout trial show how irritating and rude he is even when on record that will be used in court. He'd never listen to me, but I'll still advise him that acting the same way in front of the current judge would mean a whole bunch of time in jail for contempt. Anybody being rude in a court is likely to be getting a timeout in an orange jumpsuit. I don't think this judge is one for issuing warnings on such matters.

      1. Anonymous Coward
        Anonymous Coward

        Re: A perfect storm of his own making

        We can but hope.

        It appears his upbringing was devoid of the lessons he may have to learn now.

      2. Missing Semicolon Silver badge

        Re: A perfect storm of his own making

        Needs lessons from Johnny Depp.

    4. Michael Wojcik Silver badge

      Re: A perfect storm of his own making

      Musk under oath would be interesting.

      That's one word for it.

      Personally, I can't imagine how irritating it would be to depose1 Musk. The man is almost superhumanly obnoxious. I'd say the lawyers are earning their fees on that one.

      Though it would likely have made a terrific episode of Verbatim, perhaps even rivaling "Follow the Chicken". Unfortunately I believe Verbatim is no longer being produced.

      1In the testimonial sense, though deposing him as King of the Tech Bros would no doubt also be an agonizing process.

      1. MachDiamond Silver badge

        Re: A perfect storm of his own making

        "I'd say the lawyers are earning their fees on that one."

        I wonder if those attorneys are being sponsored by a drugs company and provided with the best in all that's calming in modern pharmaceuticals.

  4. Anonymous Coward
    Anonymous Coward

    Is the financing problem really going to get Musk off the hook?

    He still has to go to court, and his "pending financing" statement is in effect a new conditional added to the agreement, i.e. not agreed by both parties and thus not an active part of the agreement. You can't just make new sh*t up and add it to the contractual conditions, that's not how things work.

    I am not sure the financing problems will get Musk off the hook, because how Musk produces the money is not Twitter's problem, it's Musk's. It may be that he has to sell a lot more of his shares, and he still has the option of coughing up the $1bn penalty payment instead (I suspect that's what he's really trying to escape from, and anaylists seem to think he has pretty much zero chance of that).

    In any case, I suspect this deal will still provide a lesson on keeping your big trap shut in public.

    Personally I still hope he walks away from this - with his ethics he should not be allowed within a mile of any social media IMHO.

    1. heyrick Silver badge

      Re: Is the financing problem really going to get Musk off the hook?

      On the other hand, if he gets to walk away with a relatively small slap on the wrist, what lesson learned?

    2. gryphon

      Re: Is the financing problem really going to get Musk off the hook?

      The $1 billion is only an option in certain very constrained circumstances.

      e.g. Material adverse event, regulatory non-compliance etc.

      There is some mention of not being able to meet financing obligations as well but I think that ship has sailed.

      1. Flocke Kroes Silver badge

        Re: Ship eager to set sail

        The banks have a get out of this agreement free cards if Elon does not buy Twitter by a certain date. I have heard different opinions of the dates from different sources (more than one bank so perhaps there is more than one date). Either a couple of days after the judge is due to rule or early next year. Either way, Elon has been trying every possible excuse to delay so clearly he believes that a delay causes the banks to sail away without him and as a result he would not have to buy Twitter. What Mr Musk believes may not be in any way related to reality.

        He has already sold several billions worth of Tesla shares so even he understands that he is not getting out of this for a measly $1B.

        The obvious way forward for Mr Musk is to end the war in Ukraine and bring peace and prosperity to the world so he can borrow at a lower interest rate. While he is at it he can genetically engineer golden egg laying geese and hand out free unicorns to all his female employees.

        1. Anonymous Coward
          Anonymous Coward

          Re: Ship eager to set sail

          Hang on, I need to wipe the sarcasm off my screen. Be right back.

        2. Michael Wojcik Silver badge

          Re: Ship eager to set sail

          hand out free unicorns to all his female employees

          Discriminatory, shirley? Looking forward to the class action from Musk-employed Bronies.

          1. Anonymous Coward
            Anonymous Coward

            Re: Ship eager to set sail

            Why do I always get the blame?

            Shirley.

    3. Anonymous Coward
      Anonymous Coward

      Re: Is the financing problem really going to get Musk off the hook?

      If the court rules that Musk has to buy, they can (and probably will have to, knowing Musk) seize enough of Musk's assets to force the sale through. Musk has more than enough Tesla and SpaceX stock to afford the purchase entirely himself, so he can't wriggle out of it that way.

      And personally I hope he doesn't, because the sooner the bird site stops plaguing global society the better.

      1. Anonymous Coward
        Anonymous Coward

        Re: Is the financing problem really going to get Musk off the hook?

        the sooner the bird site stops plaguing global society the better

        Now that's an odd way to describe Musk?

        :)

      2. Alumoi Silver badge

        Re: Is the financing problem really going to get Musk off the hook?

        Care to bet that if he's forced to buy twatter by himself his stock will plummet to the ground?

        1. heyrick Silver badge

          Re: Is the financing problem really going to get Musk off the hook?

          Sorry, no popcorn here. I have precisely zero fucks to give for Twitter, and just as many for Musk. It is interesting only because some prat that shot his mouth off on said social platform is about to have his arse handed to him (which will, at least, be an itty bitty morsel of schadenfreude).

          This, and the chess war (two words that really don't go together) are really just distractions from the shitty mess that is reality.

        2. Richard 12 Silver badge

          Re: Is the financing problem really going to get Musk off the hook?

          It'd drop due to forced sale, but not plummet as the businesses themselves would be unaffected.

          That said, he probably doesn't have enough un-mortgaged stock. He'll have borrowed against it like crazy, because that seems to be what the super-rich do.

    4. Alumoi Silver badge

      Re: Is the financing problem really going to get Musk off the hook?

      ...with his ethics he should not be allowed within a mile of any social media...

      Oh, come on, we should make him CEO of each and every social media thingie and watch them crumble to dust.

  5. Anonymous Coward
    Anonymous Coward

    Is this just a stupid ploy to try to get out?

    If Twitter were to agree to stop the trial and accept this "Oh the deal is totally back on" thing, would Elon then use that to claim that this new thing is now the deal, and the old watertight contractually agreed upon deal has been terminated?

    1. Anonymous Coward
      Anonymous Coward

      Re: Is this just a stupid ploy to try to get out?

      More likely he was going to wait for them to drop the case and then "change his mind" again. Does double jeopardy count for chancery courts?

      1. Killfalcon Silver badge

        Re: Is this just a stupid ploy to try to get out?

        The might get into the realm of Clever Schemes, and those are, generally speaking, things that courts have seen hundreds and hundreds of times over the years, and will recognise. If Musk has competent lawyers, they'll be strongly warning against doing anything like that.

        Reality is that people try to get out of this sort of thing all the time, the only exceptional thing here is the number of zeros on the cheques. Musk and his lawyers will have to work really, really hard to come up with a novel form of bullshit the courts won't have a standardised response to already.

        1. heyrick Silver badge

          Re: Is this just a stupid ploy to try to get out?

          "they'll be strongly warning against doing anything like that."

          He appears to be rather of the mentality of "screw the rules, I have money".

          1. Anonymous Coward
            Anonymous Coward

            Re: Is this just a stupid ploy to try to get out?

            Yes, there's a reason why he and Trump are mates, only with Trump it's "screw the rules, I have other people's money"

            1. veti Silver badge

              Re: Is this just a stupid ploy to try to get out?

              Because Trump knows, it doesn't matter who (thinks they) "owns" the money. All that matters is, whose greasy fist is currently clutching on to it.

  6. julian.smith
    Angel

    Elon meet Katie

    Kathaleen Saint Jude McCormick (the Chancellor) has not fallen for any of Musk's shenanigans.

    It's all still on:

    - the depositions

    - the trial

    - the multi-billion dollar purchase of Twitter for the agreed price

    Musk doesn't make the rules in her Court

    Elon's way out of his depth on this one

    1. Anonymous Coward
      Anonymous Coward

      Re: Elon meet Katie

      Not just on this one.

  7. disgruntled yank

    "deposition by Twitter"

    For a moment, I thought that somebody had introduced a novel legal technique: ask short questions, get short answers, see whether the judge likes or retweets.

  8. 105kayem

    Perhaps he has a cunning plan, "as cunning as a fox who's just been appointed Professor of Cunning at the University of Oxford", but somehow I doubt it.

    1. zuckzuckgo Silver badge

      Well it is all about a cunning stunt. Excuse my dyslexia.

  9. Anonymous South African Coward Bronze badge

    Supposedly he is "forced" to buy twatter after all... What the dickens will he do with it?

    My flabber is ghasted... $44+bn down the drain....

  10. Anonymous Coward
    Anonymous Coward

    mmm who to root for elon or twitter?

    neither, hope both get fucked and dissappear

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