April 20 (Reuters)-Elon Musk is not subject to a “gag order” that prevents discussions on proceedings alleging that Tesla has been fraudulent. (TSLA.O) Shareholders tweeted about keeping his electric car company private in 2018, a federal judge said Wednesday.

Edward Chen, a US district judge in San Francisco, agreed that the proposed temporary restraint order would appear widespread as Musk prevented him from speaking “to anyone” about the case.

Chen also found evidence that having Musk, the world’s wealthiest person, speak publicly, according to Forbes, brought a “clear and present danger” or a “serious and imminent threat” to the trial. There wasn’t.

However, the judge also told the jury at the scheduled January 2023 trial that Musk’s tweet had already been determined to be false and, with sufficient knowledge, it was determined to be false.

After Musk tweeted on August 7, 2018, shareholders have complained of losses due to the volatility of Tesla’s shares and “secured” that Tesla could be kept private for $ 420 per share. , “Investor support has been confirmed,” he said.

Shareholder lawyer Nicholas Politt said in an email that he was pleased to be instructed by the jury to be “false and fraudulently created by Elon Musk.” He said the main remaining issue was the amount of damages incurred.

Musk and Tesla’s lawyers did not immediately respond to requests for comment.

The day after Musk said he had prepared funds to privatize Tesla at a TED conference in Vancouver, there was a request for a gag order on April 15, but the US Securities and Exchange Commission scammed over his tweet. I sued him. read more

Musk and Tesla said the proposed gag order “evokes a level of censorship” that could not be harmonized with the guarantee of free speech in the US Constitution.

They also said the order could prevent Musk from communicating with Tesla’s shareholders and discussed his proposal to buy Twitter Inc. (TWTR.N), And is about to end a consent decree with the SEC. This requires Tesla’s lawyer to scrutinize some of his tweets.

Musk said he would never lie to shareholders. He offered to buy Twitter for $ 54.20 per share.

The case is In re Tesla Inc Securities Litigation, US District Court, Northern District of California, No.18-04865.

Report by Jonathan Stempel in New York. Additional report by Hyunjoo Jin of San Francisco. Edited by Will Dunham and Bernard Orr

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