Did Musk Settle Defamation Lawsuit For $10K? Tesla Sets Record Straight

EV giant Tesla Inc TSLA on Tuesday said media reports that its CEO Elon Musk settled a defamation lawsuit against him for $10,000 were “biased and misleading.”

What Happened: Tesla critic Randeep Hothi accepted an offer under California law used to shift the cost of litigation to the losing party and was not offered a settlement, Tesla said in a tweet. Tesla was responding to a media report that said Musk settled a defamation lawsuit filed by student Randeep Hothi for $10,000.

“Mr. Hothi accepted a ‘998’ offer under California law. These offers are used to shift the cost of litigation to the losing party. If Mr. Hothi had not accepted it, he could have been on the hook for significant legal costs when he eventually lost. The offer expressly denied any liability by Mr. Musk. This was an admission of defeat by Mr. Hothi and his lawyers, not a victory,” Tesla said in a Tweet.

Why It Matters: Hothi, known on the internet as “Skabooshka,” is part of a group of short sellers and Tesla critics on Twitter known as $TSLAQ.

In a Twitter thread posted on Monday, Hothi said that he filed a defamation lawsuit against CEO Elon Musk for a 2019 email to PlainSite, a legal research website, wherein the CEO claimed that Hothi “almost killed” Tesla employees.

“I made clear it wasn't about money, and told him I would dismiss the lawsuit if he would simply apologize,” Hothi said. Hothi claims that Musk offered him to settle in March and he has now decided to “accommodate Musk.”

Hothi has been at odds with Tesla for long. He commenced “investigating” Tesla in 2016 by his own admission and in 2019, Tesla tried to get a restraining order against him claiming he endangered employees in his zeal to gather information on the company.

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