Distribution of the Tesla Fair Fund Established by the Securities & Exchange Commission

Rhea-AI Summary

The SEC announced a distribution plan for a Fair Fund related to lawsuits against Elon Musk and Tesla, Inc. Those who acquired TSLA shares between August 7 and August 8, 2018, may be eligible for payments if they experienced a Recognized Loss of at least $10. The total civil penalties of $40 million paid by Musk and Tesla have been set aside for affected investors. Claim Forms are due by September 17, 2022, and can be filed online or mailed to the designated address. More details can be found at www.SECvTeslaFairFund.com.

Positive

• Establishment of a Fair Fund of $40 million for harmed investors.
• Potential payments for eligible TSLA shareholders who suffered losses.

Negative

• The lawsuits indicate a history of misleading statements by Elon Musk.
• The SEC's involvement and penalties may impact public perception of Tesla.

WASHINGTON, June 3, 2022 /PRNewswire/ -- The following is being released by the Securities and Exchange Commission about the lawsuits SEC v. Elon Musk, No. 18-cv-8865 (S.D.N.Y.) and SEC v. Tesla, Inc., No. 18-cv-8947 (S.D.N.Y.).

Those who purchased or acquired Tesla common stock, listed on a U.S. Exchange and registered with the Commission and traded under the symbol TSLA (the "Securities") during the Relevant Period (between 12:48:16 p.m. EDT on August 7, 2018 and 4:00 p.m. EDT on August 8, 2018), may be eligible for a distribution from the Fair Fund.

On September 27, 2018, the Securities and Exchange Commission ("SEC" or "Commission") filed a civil action against Elon Musk ("Musk") alleging violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder in connection with certain false and misleading statements by Musk. 

On September 29, 2018, the Commission filed a related civil action against Tesla, Inc. ("Tesla") alleging violations of Exchange Act Rule 13a-15, also in connection with Musk's false and misleading statements. 

The two complaints alleged that Musk, the Chief Executive Officer of Tesla, made a series of materially false and misleading statements about Tesla on his Twitter account in August 2018, and that Tesla failed to implement adequate procedures or controls for determining whether to disclose the information Musk disseminated on Twitter in its filings.

Musk and Tesla (the "Defendants") paid a total of $40 million to the Commission. By Order entered February 26, 2020, the Court established a Fair Fund, so the civil penalties paid by the Defendants can be distributed to harmed investors.

To receive a payment from the Fair Fund, you must satisfy the following: 1) You must have purchased or acquired Tesla common stock, listed on a U.S. exchange and registered with the Commission and traded under the symbol TSLA, during the Relevant Period; 2) Your approved transactions must calculate to a Recognized Loss Amount pursuant to the Plan of Allocation and the Distribution Payment must equal or exceed $10.00; and 3) You are not an Excluded Party as defined in the Plan of Distribution (the "Plan").

You can file an online Claim Form or obtain a physical Claim Form by visiting www.SECvTeslaFairFund.com. To submit a Claim Form by mail, you must submit it to SEC v Tesla Fair Fund, c/o Rust Consulting, Inc., Distribution Agent – 7329, P.O. Box 44, Minneapolis, MN 55440-0044. All Claim Forms are due by September 17, 2022.

For more information:
Copies of the Plan, the Plan Notice, and the Claim Form are available at www.SECvTeslaFairFund.com as well as background information. You may also call 1 (877) 576-9981 or email the Distribution Agent at info@SECvTeslaFairFund.com.

View original content:https://www.prnewswire.com/news-releases/distribution-of-the-tesla-fair-fund-established-by-the-securities--exchange-commission-301551771.html

SOURCE U.S. Securities and Exchange Commission

FAQ

What is the Tesla Fair Fund distribution?

The Tesla Fair Fund distribution is a $40 million allocation for investors harmed by misleading statements made by Elon Musk between August 7 and August 8, 2018.

How can I claim my share from the Tesla Fair Fund?

Eligible investors can file a Claim Form online or by mail by the deadline of September 17, 2022, as detailed on the SEC's website.

Who is eligible for payments from the Tesla Fair Fund?

Investors who purchased TSLA shares during the Relevant Period and have a Recognized Loss of at least $10 are eligible for payments.

What were the allegations against Elon Musk and Tesla?

The SEC alleged that Musk made materially false and misleading statements about Tesla on Twitter, and Tesla failed to have adequate controls to manage such disclosures.

What is the deadline to file for the Tesla Fair Fund?

The deadline to submit Claim Forms for the Tesla Fair Fund is September 17, 2022.