In the continuing saga of bad luck and bad decisions on behalf of Tesla CEO Elon Musk, it seems the billionaire is facing some serious consequences after the US Securities and Exchange Commission filed documents suing him for fraud.
Why? All because of a dumb pot joke.
As we’ve previously reported, Musk came under fire after tweeting out that he was considering taking the company private at $420 a share. Am considering taking Tesla private at $420. Funding secured.
Ha! What a laugh, right? Well, stockholders didn’t seem to think so. The company’s numbers immediately went into a bit of a nosedive, leading to a particularly bad news week for Musk, who seemed depressed and repentant in a New York Times piece a few days later.
Am considering taking Tesla private at $420. Funding secured.— Elon Musk (@elonmusk) August 7, 2018
But, rather than cooling off and trying to get things back on track, Musk exacerbated the problem by lighting up on 'The Joe Rogan Experience', further solidifying his image as a hippie pothead in his stockholders' minds. Look, we’re all for smoking a bit to take the edge off of a stressful week, but even we have to admit that this was a pretty poor strategic move, given the current controversy.
Besides, it now looks like it’s about to get a whole lot worse before it gets any better, as the SEC legal complaint against the CEO proves that this issue isn’t going away anytime soon.
The Commission’s complaint alleges that the tweet was misrepresentative and constituted fraud. Musk, for his part, called the accusation "unjustified" and refused to settle.
Venture capitalists suspect that the fallout from the lawsuit leaves only a 25% chance that Musk will remain at the head of the company.
But who knows? Maybe he’ll get in the business of cannabis vapes or some other industry that looks more friendly upon his recent hobby of choice.