Monday JP Morgan did lawsuit against Tesla for 162 million dollars, accusing her of violating a contract relating to certain warrants after her stock price skyrocketed. This was reported by the Reuters agency, explaining that - based on the complaint filed before the Federal Court in Manhattan - in 2014 Tesla sold JP Morgan warrants that they would have paid if their "strike price" had been lower than the share price of Tesla at the expiry of the warrants themselves, set for June and July 2021.
The American financial giant, believing it has the right to adjust the strike price, said it had reduced it substantially after a Elon Musk's tweet on August 7, 2018. On that occasion, the owner of the electric car company wrote that he could have made Tesla private at 420 dollars per share and have "insured financing". JP Morgan then backed down when Musk dropped the idea 17 days later.
Despite this, before the expiry of the warrants the price of Tesla stock has soared, increasing almost tenfold. For this, according to the Bank of Wall Street, under the contract Tesla would have had to deliver shares or cash and since it has not done so, it must be considered in default.
"Although JP Morgan's adjustments were appropriate and provided for in the contract - the complaint reads - Tesla ignored the obligation to pay JP Morgan in full". The electric car maker did not respond to requests for comment after the Wall Street shutdown.
Also according to the complaint, Tesla surrendered the warrants to limit potential stock dilution resulting from a convertible bond sale and to reduce federal income taxes.
Tesla complained in February 2019 that JP Morgan's adjustments were "an opportunistic attempt to exploit the volatility of Tesla's stock," but it didn't dispute the underlying calculations, the financial giant said.
The 2018 tweets cost Elon Musk and Tesla a 20 million fine from the SEC, the American Consob.
