Thread by @WillOremus

I'm back in hazy, steamy, downtown Wilmington for day 2 of Elon Musk's testimony in a Delaware chancery court trial. He's accused by some Tesla shareholders of buying a struggling solar company run by his cousin, which Musk partly owned, for more than it was worth.

This am the plaintiffs' lawyer pressed Musk as to whether he played a role in negotiating the acquisition price of SolarCity. Musk at first said "not materially so, no." Baron displayed notes from a banker showing Musk at one point proposed a sale price of $28.50 per share.

Baron appeared to show fairly clearly this am (imo) that Musk personally pressed both SolarCity & Tesla to accelerate the deal before SolarCity ran out of cash--including shortening the due diligence period by Tesla's bankers.

Musk acknowledged he felt time pressure to complete the deal before SolarCity ran out of cash. "Obviously there was urgency to complete the diligence in a timely manner," he said. At another point he said: "We needed to either fish or cut bait here."

Musk has acknowledged that he led the push to buy SolarCity, but maintains he properly recused himself from formal negotiations due to his role at SolarCity. Baron (plaintiffs' atty) is making case that Musk was playing both sides at every turn despite the formal recusal.

The plaintiffs' atty keeps irking Musk by using words like "coopted" and "cabal" to describe his actions. It may be strategic on his part--if he can goad Musk into acting like a tyrant who can't stand criticism, that supports his portrayal of Musk as a self-interested bully.

Musk has kept his tone of voice calm, while his words & facial expressions often convey exasperation. Today he told Baron, "Your questions are so deceptive it's silly." And another time, when he caught Baron out on a numerical claim: "You're shooting yourself in the foot here."

The Musk trial has taken a break earlier than expected this morning because a member of the court threw up. Not sure when we'll be let back in, but I guess I'm glad I masked up today. (Masks are not required for the vaccinated, and few are wearing them.)

Rumor is "food poisoning," although that's what the lawyers call hearsay.

When we go back in I'll have to stop tweeting. I was tapped on the shoulder yesterday & informed there's no live-tweeting allowed, although live-blogging by some other outlets seems to be kosher.

I'll be on @CNBC around 1130am ET talking briefly about the Musk trial, if you're into that sort of thing.

So far it's been an entertaining tete-a-tete, w/ lots of evidence that seems suggestive of the plaintiffs' case but Musk still projecting confidence he did nothing wrong.

While the Musk trial is still in recess after a member of the plaintiffs’ team threw up, here’s a fun fact about the Delaware Chancery Court. It’s the site of the first major anti-segregation ruling in the US, which laid the groundwork for Brown v Board of Educatjon.

Biden aside, Wilmington has a reputation as a down-on-its-luck post-industrial city. But the downtown is not without charm. It’s just that all of the cute lunch spots seem to be indefinitely closed.

Ok I found the spot. It’s the water ice truck outside the courthouse.

Elon Musk's testimony is now complete, though the trial is expected to stretch into next week. Here are some of the highlights from this afternoon's questioning:

Musk was back on the stand around 1230pm ET after the unfortunate puking incident. Baron (plaintiffs' atty) wrapped up cross-X by suggesting that Musk has long overhyped Tesla's solar products, including the "solar roof" concept that has been beset by delays and cost overruns.

Baron called out a 2016 Musk tweet claiming Tesla's "solar roof" concept would be deployed by 2017, which... yeah, not even close.

Musk's response: "I have a habit of being optimistic with schedules."
Baron: "This is more than optimistic. This is just plain-out false."

Musk insists the solar roof time table really was optimism, not intentional deception.

Musk: "If I wasn't optimistic, I don't think I would have started an electric car company or a rocket company. A certain amount of optimism is necessary for such endeavors."

I think that exchange gets at a central tension of Musk's career. He makes impossible promises, & routinely fails to deliver on time. And yet, in the frantic rush to do the impossible, his teams often end up delivering something impressive in its own right. But not always.

With Baron done, Musk's lawyer Evan Chesler began redirect. He presented notes from a July 2016 Tesla board meeting that showed the board by then was well aware of SolarCity's cash-flow crisis, & discussed it before approving the deal. Countering the claim that Musk hid all that.

Musk's lawyer Chesler made the case that SolarCity's cash problems (which seem quite dire!) were partly a result of Tesla's acquisition bid. Otherwise it could have raised money itself and remained a going concern. But the limbo of awaiting a deal put it temporarily into crisis.

When Musk's lawyer finished, we got our first questions from the judge, Joseph R. Slights III. He wanted to better understand why the timing of the SolarCity acquisition made sense *for Tesla.* (The plaintiffs allege it was driven by SolarCity's needs, not Tesla's.)

Musk said an integrated solar product was a necessity bc Tesla had developed the Powerwall (solar battery), but the battery was useless without panels. And building integrations for third-party panel installers would be a headache. Buying SCTY allowed a seamless integration.

The judge was a bit perplexed as to why, if its solar battery wouldn't work as a standalone product, Tesla got into the solar business in the first place. How did making solar batteries fit with the business of an electric car maker?

Musk responded w/ his now-familiar refrain about the Tesla Master Plan. It's not an EV company--that's a misnomer. It was always a company created to build a "sustainable energy future." EVs are one pillar; clean energy generation (SCTY) & storage (Powerwall) are the other two.

Judge asked if Tesla ever thought about buying a different solar company than the one Musk's cousin ran, and Musk part-owned. Musk says no; he understood Solarcity's business best, and thought its products superior.

Baron's final cross-x was to point out that SolarCity was using pretty much the exact same imported panels as all of its rivals at the time.

Musk, channeling Steve Jobs, replied that the details make all the difference: better "edge effects," the "quality of the mounting job."

Musk argued that to say SolarCity's solar business was the same as rivals just bc they use the same panels is like saying Apple devices are the same as rivals because they use screens made by, e.g., Samsung. (I uhh don't think that's quite right, but I guess one gets the drift?)

Next on the stand is Kimbal Musk, Elon's brother and fellow member of the Tesla and SpaceX boards. I'll probably tap out soon but heading back in now to catch a bit of his testimony.

In case anyone was wondering whether Elon would stick around for his brother’s testimony, or to take in the sights of the Wilmington Riverfront….

https://twitter.com/ElonJet/status/1415018683823534081