Tesla sues JPMorgan over contract affected by Musk tweet | Photo credits: Copyright © 2014 Tesla Motors, Inc.
by Jonathan Stempel
NEW YORK, Jan 24 (Reuters) – Tesla on Monday announced its decision to fight back in its bond dispute with JPMorgan, with the electric car maker accusing the U.S. bank of seeking to profit of a famous tweet from Elon Musk in 2018, in which the businessman mentioned a withdrawal from the rating of his company.
In its lawsuit, Tesla accuses JPMorgan of “bad faith and avarice”, the bank claiming $162.2 million from it after it unilaterally changed the terms of guarantees received during an issuance of convertible bonds by Tesla in 2014.
By changing these conditions, “JPMorgan has created a real boon for itself,” said the American manufacturer of electric vehicles in its application filed in Manhattan federal court.
The lawsuit escalates the battle between America’s largest bank and Tesla, whose business relationship has been in dispute ever since.
The warrants give their holders the right to buy shares of the company at a specified price and “exercise” date.
In a lawsuit filed Nov. 15, JPMorgan said Elon Musk’s Aug. 7, 2018 tweet, in which he discussed delisting Tesla and claimed to have “secured funding” for the deal, then the abandonment of this project 17 days later had led to volatility in the share price justifying the lowering of the exercise price of its guarantees. (Reporting Jonathan Stempel in New York; French version Dagmarah Mackos)