Members of Tesla's board of directors are lawyering up as crisis around Elon Musk deepens
- Some members of Tesla's board of directors are hiring lawyers to protect themselves in the ongoing fallout from CEO Elon Musk's public declarations about taking the company private.
- Fellow board members are also urging Musk to cool it with the public statements about a go-private deal, according to a New York Times story published Tuesday night.
- By all appearances, Musk has ignored that advice.
- In the days since he tweeted that a privatization deal was "funding secured," the chief executive has only waded further into murky legal territory, seemingly hashing out the plan in real time, on Tesla's blog and on social media.
- Tesla is now facing multiple lawsuits over this.
Some Tesla board members are getting nervous while Elon Musk publicly ruminates about taking his electric-car company private - so much that some have hired attorneys to protect themselves from legal exposure, The New York Times reported Tuesday night.
Fellow board members are also urging Musk to cool it with the social media posts about a go-private deal. But by all appearances, Musk has ignored that advice. The chief executive has talked out the plan on Tesla's blog and on Twitter, even as the Securities and Exchange Commission said it was monitoring the situation.
It is unusual for the CEO of a publicly traded company to approach financial strategy the way Musk has in the past week. The company is now facing multiple lawsuits over this.
Musk's online musings have rattled shareholders, and, according to the Times, that anxiety is most tangible among some on the board. Independent members have hired Paul, Weiss, Rifkind, Wharton & Garrison to address the emerging SEC inquiry. A source familiar with the matter cited by the newspaper said the board believes the SEC matter could become a "full-blown investigation."
Three directors have retained the law firm, Latham & Watkins, to assist them with an official proposal from Musk to take Tesla private.
Musk's first tweet about going private reportedly caught the board off guard, The New York Times reported on Monday.
Citing two people familiar with the internal response to Musk's August 7 posting, The Times said the tweet was sent "with little forethought," and that "some members of the board had been totally blindsided" by Musk's move to announce the plan on Twitter.
Read more about Tesla possibly going private:
- There's an X-factor in Tesla's go-private deal that no one is considering while they try to figure out what Elon Musk is thinking
- 'It was, at best, hasty and naive, and, at worst, manipulative': Experts slam Elon Musk's confusing defense of why he tweeted 'funding secured'
- Elon Musk says he is working with Goldman Sachs and Silver Lake to help take Tesla private
- Some of Tesla's board members were reportedly 'totally blindsided' by Elon Musk's tweet about going private
- People close to Saudi investment fund reportedly cast doubt on Elon Musk's claims about negotiations to take Tesla private
- It is now abundantly clear that Elon Musk does not have 'funding secured'