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> closing the transaction on the price and terms agreed upon They're definitely suing for specific performance, and I'm not sure they really have any other opt

> closing the transaction on the price and terms agreed upon They're definitely suing for specific performance, and I'm not sure they really have any other option at this point. It would be by far in their best financial interest if they can force closing the sale, and Musk's objections seem really thin. Doing anything less than that is complete capitulation I can see them reaching a settlement to agree to cancel the deal with Musk if he agrees to pay a significant penalty ($5B+), or maybe agree to reduce the purchase price some, but why not sue for specific performance if you think you'll win?

elliekelly 4y ago
Is his “financing secured”? It just seems like an incredible (and incredibly risky) long shot to me: a judge actually ordering a sale to an unwilling buyer (and Musk, of all buyers!) is a long shot and the big banks going through with funding such a big deal to an _unwilling_ owner is a long shot. But _even_if_ both of those two unlikely things happen what happens when the judge orders specific performance and Musk just... doesn’t? (Not usually a risk you have to factor in but with Musk I think this is absolutely a real possibility. Maybe even the most likely possibility.) Will they issue a warrant for his arrest? A daily fine for contempt? That would be the deal of the century for Musk. I don’t know the right answer when you’re dealing with a megalomaniac like Musk but I really don’t think specific performance is it. I am cautiously optimistic that whatever it is Musk is up to will eventually give rise to some cool new federal securities laws. Maybe even some new federal crimes! (Who am I kidding, a crime that only the wealthiest of the wealth would even be able to commit? Not in a million years!)
- chernevik 4y ago
  Not a lawyer, but I expect that given a verdict a judge can and will attach assets to force compliance. The court could order Musk to sell Tesla shares to raise the necessary funds, and seize the shares to do so itself even if he won't.
- humanwhosits 4y ago
  > A daily fine for contempt? Probably a large one. But if Tesla shares tank, and the other investors bail out, perhaps he just doesn't mechanically have the funds to do so.
  - lovich 4y ago
    When normal people agree to spend more than they have that normally ends up in bankruptcy and liquidating most assets other than a few exceptions. Obviously that won’t happen here because the rich have a different set of laws but on the surface he either has the assets to pay it off or would have to sell everything he had and start over
    - rkagerer 4y ago
      What specifically would prevent this?
      - lovich 4y ago
        De jure? Nothing, as written the law applies equally to all. De facto? Just observe how often the rich are convicted for their crimes. Even in the rare cases that they are jailed, the severity of the sentence is usually much lower than the common man. Look at Musk himself, he already agreed to not tweet about tesla without the boards approval in an agreement with the SEC to avoid punishment, then routinely ignored it and just fought them in court until he won. Our system allows for anyone with enough money to run out the clock until they either win, the other side gives up, or the situation no longer matters and the case is dropped.
        listenallyall 4y ago
        > until he won He won. He prevailed. In court. Whatever you think he did that violated the SEC's order, is not correct, at least in the eyes of the judge or the jury who heard all the evidence and decided the case. Rich people do have the benefit of hiring excellent lawyers and affording every available opportunity to appeal. But that is not being "above the law," that is the law. At the end of the day, if Musk won even on the 10th appeal or whatever, then you can't say that he committed a crime.
- amluto 4y ago
  I’m not a lawyer, and I suspect this gets into old and bizarre traditions of equity. But the damages for failure to perform may conceptually straightforward: the difference between TWTR’s market cap and the deal price * number of outstanding shares. Which is over $10bn.
  - gene91 4y ago
    But TWTR’s market cap is and will be influenced by Musk’s series of actions and announcements. Both parties would have to come up with a hypothetical number for how much TWTR is worth if Musk walks away without paying anything, and there’s no way their estimates would come close.
    - carnitine 4y ago
      That’s Musk’s fault. The market cap will be calculated the way it would in any other scenario. You’ve just made up some weird rule that doesn’t exist.
- admax88qqq 4y ago
  Probably instead of arresting Musk they just sieze assets to cover the damages. His assets are mostly on paper anyways.

elliekelly 4y ago

Is his “financing secured”? It just seems like an incredible (and incredibly risky) long shot to me: a judge actually ordering a sale to an unwilling buyer (and Musk, of all buyers!) is a long shot and the big banks going through with funding such a big deal to an _unwilling_ owner is a long shot. But _even_if_ both of those two unlikely things happen what happens when the judge orders specific performance and Musk just... doesn’t? (Not usually a risk you have to factor in but with Musk I think this is absolutely a real possibility. Maybe even the most likely possibility.) Will they issue a warrant for his arrest? A daily fine for contempt? That would be the deal of the century for Musk. I don’t know the right answer when you’re dealing with a megalomaniac like Musk but I really don’t think specific performance is it. I am cautiously optimistic that whatever it is Musk is up to will eventually give rise to some cool new federal securities laws. Maybe even some new federal crimes! (Who am I kidding, a crime that only the wealthiest of the wealth would even be able to commit? Not in a million years!)

chernevik 4y ago
Not a lawyer, but I expect that given a verdict a judge can and will attach assets to force compliance. The court could order Musk to sell Tesla shares to raise the necessary funds, and seize the shares to do so itself even if he won't.
humanwhosits 4y ago
> A daily fine for contempt? Probably a large one. But if Tesla shares tank, and the other investors bail out, perhaps he just doesn't mechanically have the funds to do so.
- lovich 4y ago
  When normal people agree to spend more than they have that normally ends up in bankruptcy and liquidating most assets other than a few exceptions. Obviously that won’t happen here because the rich have a different set of laws but on the surface he either has the assets to pay it off or would have to sell everything he had and start over
  - rkagerer 4y ago
    What specifically would prevent this?
    - lovich 4y ago
      De jure? Nothing, as written the law applies equally to all. De facto? Just observe how often the rich are convicted for their crimes. Even in the rare cases that they are jailed, the severity of the sentence is usually much lower than the common man. Look at Musk himself, he already agreed to not tweet about tesla without the boards approval in an agreement with the SEC to avoid punishment, then routinely ignored it and just fought them in court until he won. Our system allows for anyone with enough money to run out the clock until they either win, the other side gives up, or the situation no longer matters and the case is dropped.
      - listenallyall 4y ago
        > until he won He won. He prevailed. In court. Whatever you think he did that violated the SEC's order, is not correct, at least in the eyes of the judge or the jury who heard all the evidence and decided the case. Rich people do have the benefit of hiring excellent lawyers and affording every available opportunity to appeal. But that is not being "above the law," that is the law. At the end of the day, if Musk won even on the 10th appeal or whatever, then you can't say that he committed a crime.
amluto 4y ago
I’m not a lawyer, and I suspect this gets into old and bizarre traditions of equity. But the damages for failure to perform may conceptually straightforward: the difference between TWTR’s market cap and the deal price * number of outstanding shares. Which is over $10bn.
- gene91 4y ago
  But TWTR’s market cap is and will be influenced by Musk’s series of actions and announcements. Both parties would have to come up with a hypothetical number for how much TWTR is worth if Musk walks away without paying anything, and there’s no way their estimates would come close.
  - carnitine 4y ago
    That’s Musk’s fault. The market cap will be calculated the way it would in any other scenario. You’ve just made up some weird rule that doesn’t exist.
admax88qqq 4y ago
Probably instead of arresting Musk they just sieze assets to cover the damages. His assets are mostly on paper anyways.