Elon Musk is sued for $ 160 million due to some old tweets

A 2018 tweet from Elon Musk is why JPMorgan Chase is denouncing the eccentric character.

Elon Musk , CEO of Tesla  and SpaceX, is being sued by banking giant JPMorgan Chase  for a tweet published in 2018.

The lawsuit, which demands $ 162 million from the eccentric character, notes that because of a 2018 tweet in which Musk said he was considering privatizing the automaker when shares hit $ 420, the bank stopped trading. earn millionaire earnings from your shares.

“We have provided Tesla with multiple opportunities to fulfill its contractual obligations, so it is regrettable that they have brought this matter to litigation,” a JPMorgan spokesman said in a statement accessed by Reuters.

What happened to the stocks?

The problem stems from Tesla’s options , or “warranties,” held by JPMorgan. The warrants came with a “strike price” which meant that if the auto company’s shares were worth $ 560 or more when the options expired, Tesla would owe the bank the difference between the actual share price and $ 560. ruled.

Considering that Tesla shares were worth more than $ 600 in June, JPMorgan expected to make quite a bit of money. However, since Musk tweeted that he would privatize Tesla at $ 420 a share, it meant the bank would not be able to reach that $ 560 of the guarantee. So JPMorgan had to lower the strike price to compensate.

JPMorgan said in its complaint that Tesla had not fulfilled its contract to deliver the agreed amount of its shares or cash. The bank said that Tesla’s failure to do so amounted to a default.

“Although JPMorgan’s adjustments were appropriate and contractually required,” the bank’s complaint read, “Tesla has flagrantly ignored its clear contractual obligation to pay JPMorgan in full.”

In 2018, Musk was forced to step down as chairman of Tesla’s board of directors after a clash with the US Securities and Exchange Commission, which accused him of misleading investors by tweeting about a possible withdrawal of Tesla from the trading floors.