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Autonomous Vehicles

Tesla Criminal Probe Looks at Musk’s 2017 Comments

It’s that time of the month again, when observers of Tesla need to be reminded that white-collar criminal probes almost always end without charges, and the bar for proving criminal intent to defraud is incredibly high. For the second time in two months, there’s a report about a criminal securities fraud probe related to Elon Musk’s public comments about Tesla—this time about Model 3 production capabilities in 2017.

What’s more, a federal judge in August dismissed a shareholder class-action lawsuit that relied on no fewer than 11 former Tesla workers who alleged, in various ways, that Musk should have known there was no way Tesla could hit its production targets in 2017. “Federal securities laws do not punish companies for failing to achieve their targets,” the judge overseeing the lawsuit wrote. (The judge allowed the plaintiffs to refile the suit.) Without hard evidence that Musk intentionally lied to investors, instead of just making wildly optimistic statements, chances are the probe will stall.

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