The biggest lawsuits Elon Musk is facing
From government investigations, to labor disputes and even a custody battle, Elon Musk has a lot to lose in the halls of justice. Here’s the tea on Musk’s biggest lawsuits.
Transcript
00:00The average person probably doesn't know about all the lawsuits facing Elon Musk.
00:04I mean, there's some big-name ones like the OpenAI lawsuit or his pay package.
00:09Lawsuits against Elon Musk could have detriment to some of the brands Tesla X. We'll see how these play out. Hi, I'm Jordan Hart.
00:17I'm a tech reporter here at Business Insider and today we have another BI reporter joining us.
00:21I'm Grace Kay and I'll be spilling all the tea on the big cases and investigations against Elon Musk and his companies. Let's do it, Grace.
00:30Oh, ****. I spilled the tea.
00:33Has it been hard to obtain such information and just uncover more facts about these legal issues that Elon Musk is facing?
00:39He has so many companies. They're in different parts of the country. He also has these very intense legal teams.
00:44He's been able to seal some of his cases. We had to look countywide, federal, state to find the different lawsuits.
00:52I'm sure there's some we still haven't found, just the nature of the game. And there were different points.
00:56I worked with a few other people on the story where we were like, OK, there's so many now we have to narrow it down because we can't include all of these in the story.
01:04He has a pretty well-known ex, Grimes, also known as Claire Boucher.
01:08Can we talk a little bit about their case? I know they have something going on there between their kids.
01:13Well, first, Musk filed a custody suit against Grimes in Texas court. Grimes kind of pushed back on that.
01:20She filed her own custody suit in California.
01:23There's this kind of legal battle between which state has custody. They're trying to prove, you know, where are the children more.
01:29Currently, where the case stands is they filed to seal it from the public because of the personal nature of it.
01:36There was a lot of information about like nannies, child psychologists, things like that that were more sensitive.
01:42And, you know, obviously, Musk is worth hundreds of billions.
01:46Grimes is a pretty successful recording artist, musician, but definitely not touching the wealth of her ex.
01:54Do you think that comes into play here?
01:56The kind of the disparity between him having essentially endless access to endless resources, whereas she's still, you know, well off, but definitely not uber wealthy like Elon Musk is?
02:08I would say it's definitely like a David versus Goliath case.
02:12Since Elon Musk's takeover, Twitter or how it's been rebranded as X has faced a lot of lawsuits.
02:19Securities and Exchange Commission is investigating his stock purchases going into the acquisition.
02:26They're looking at whether he disclosed those purchases on time.
02:30So that's an ongoing investigation.
02:32And Musk is a big proponent of free speech.
02:34As we all know, he's been very vocal about protecting free speech rights.
02:37And he's kind of putting his money where his mouth is and using his company to back someone up.
02:43Elon Musk's company X has started an initiative to support people who've tweeted things that were maybe less savory or got them in hot water.
02:53So, for example, there's this Disney actress, Gina Carano.
02:56She compared conservatives in America to what Jewish people experienced in Nazi Germany.
03:02And as a result, she was no longer on the cast of The Mandalorian.
03:07So Elon Musk's X is supporting her in bringing a lawsuit against Disney.
03:12Could you imagine having someone there throwing their money behind you legally, financially to protect your wildest tweets?
03:19A billionaire, one of the richest people in the world, is going to be 10 toes behind you, backing you up.
03:24If anything, you might even get a payday out of it.
03:28So Musk is facing a lot of lawsuits from regulatory agencies.
03:33One of them is the National Labor Relations Board.
03:36They accused SpaceX of illegally firing some people after they wrote an open letter talking about Elon Musk and saying basically his work at Twitter and like the things that he was posting were a distraction to the company.
03:51SpaceX responded by suing the NLRB.
03:55What's at stake for Musk in the larger picture of this lawsuit?
03:58The NLRB, if they had it their way, those workers would be rehired.
04:01That's something that's happened at Tesla similarly, where the NLRB stepped in.
04:05So the NLRB case still ongoing.
04:08What would it mean in a larger sense if Elon Musk and SpaceX won this case against the NLRB?
04:13They'd think twice the next time they tried to come in between him and one of his companies.
04:18With the Department of Justice case, maybe that would change some of SpaceX's hiring practices.
04:24The Department of Justice is actually suing SpaceX over allegations that the company discriminates against refugees.
04:31One of the things they cited in their lawsuit was that Elon Musk tweeted about how SpaceX couldn't hire people if they didn't have a green card due to security clearances in the country.
04:41The Department of Justice case also ongoing.
04:43So I guess it's kind of a wait and see.
04:44We'll see how these play out.
04:48The EEOC is actually suing Tesla for racial discrimination.
04:52There's been some reports of like racist characters drawn in the bathrooms, Nazi swastikas, things like that.
05:01I mean, I definitely couldn't imagine going to work and, you know, seeing racist images in a place where, you know, I just want to, you know, get my work done.
05:08Where are we at with this case?
05:09So Tesla filed a motion to dismiss and a judge denied that.
05:13So it's going to progress to trial.
05:15And Tesla is facing something on the product side, right?
05:18The National Highway Traffic Safety Administration, or NHTSA, has been looking into different claims.
05:25So they've looked into issues with steering, phantom braking, things that could impact the safety of customers.
05:31The Department of Justice is also looking into Tesla's driver assist software.
05:37So it has autopilot and full self-driving and claims that Tesla might be misleading the public as to how, you know, proficient or usable that software is.
05:47And these are investigations so far, not full blown lawsuits.
05:50Yes, these are investigations.
05:52So they're still kind of gathering information and looking into it and things like that to determine what's next.
05:58Could there be recalls?
06:00Like, what does this mean for the future of Tesla's products?
06:03Other major companies are also facing, you know, issues with the Department of Justice.
06:08I know Apple has had some issues going on.
06:10Google. I mean, it seems like in the tech industry, this isn't necessarily a nail in the coffin or like, you know, it doesn't seem like it's going to super slow down what's going on at Tesla.
06:22Is that accurate?
06:23No. Yeah, I would say like some of that is just the nature of being a major company.
06:27So let's talk about the big case, the $55 billion case that Elon Musk is facing right now.
06:32So some shareholders in 2018, one shareholder representing others, filed a lawsuit alleging that Elon Musk's pay package was beyond the bounds of reasonable judgment.
06:43They argued that he had undue influence over this pay package because of his close relationship to people on the board.
06:48A judge heard that case last year.
06:50And then in January, she decided to strike down the pay package.
06:54She agreed that Musk had undue influence.
06:56So what Tesla did was instead of appealing the case, they took the pay package back to Tesla shareholders and had them revote.
07:04So they voted in 2018 to approve it, and then they had them vote again in June to approve it.
07:10The shareholders approved it.
07:11And now Tesla has taken that vote back to the judge to say, you know, shareholders are aware of what's going on.
07:18You know, we brought in an independent oversight committee to make sure everything was above board to see if like she will reinstate the package.
07:26If she doesn't, they'll likely appeal and take it to, you know, the leaders above this judge.
07:31Elon has come out with the Cybertruck and he's really pushing the autonomous driving in Tesla.
07:39It seemed like he's really pushing for innovation in Tesla.
07:43Is that something that you think the shareholders are like really impressed with?
07:46I mean, it seems like they're going to bat to pay him.
07:48A lot of money.
07:49Why do you think that is?
07:51So I think there's this underlying threat or like fear that Elon Musk will step away from the company if they don't approve this pay package.
07:59You think he would really do that?
08:00He's very much a wild card.
08:02I would say like a lot of his wealth is tied up in Tesla.
08:05So that seems unlikely to me.
08:07Is Musk really in trouble here or is he kind of got some insulation, some cushion or complete immunity with his wealth of resources?
08:15He can hire some of the best people in the business, pay them like thousands of dollars an hour.
08:21There's been cases like with some of his employees who sued him and they've won.
08:25Tesla sent it back, you know, and got it lower just because they could stay in the game that way financially.
08:31I think like the thing you probably want to look at closely is just like how regulators are responding and what that'll look like going forward.
08:37There's also the court of public opinion.
08:39No matter what the outcome is in like the legal courts, people will still kind of form their opinions about like the nature of the cases and things like that.
08:47And I think it's pretty interesting, you know, him being in charge of one of the biggest social media platforms out there right now where people are sharing their opinions and like calling him out in certain corners of X.
08:58You know, I think it's really interesting to see what his money can and cannot buy.
09:05Do you guys watch Love Island this season?
09:07I've seen like half of the U.S. season.
09:10As a Love Island expert, it feels so weird that so many people are like watching it this year because I'm like, I've been watching Love Island since 2019.
09:18Yeah, like I was there when Love Island season five of the U.K. with Molly Mae.
09:23And no, it's.
09:24Oh, Tommy Fury.
09:25Come on now.
09:26Yes.
09:26I think the best Love Island season, season two.
09:29Yeah.
09:30Oh, my God.
09:31Oh, great.
09:32Grace, you don't even know what you just did.
09:37I don't even know what I just did.
09:38I don't even know what I just did.
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09:40I don't even know what I just did.
09:41I don't even know what I just did.
09:42I don't even know what I just did.
09:43I don't even know what I just did.
09:44I don't even know what I just did.
09:45I don't even know what I just did.
09:46I don't even know what I just did.
09:47I don't even know what I just did.
09:48I don't even know what I just did.
09:49I don't even know what I just did.
09:50I don't even know what I just did.
09:51I don't even know what I just did.
09:52I don't even know what I just did.
09:53I don't even know what I just did.
09:54I don't even know what I just did.