FOLLOWUP: Tesla Motors says Eberhard's lawsuit "will not have any effect on Tesla's considerable momentum"
Brabus Tesla Roadster - Click above for high-res image gallery
If you are sick of hearing about the lawsuit filed by Tesla Motors co-founder Martin Eberhard against the company and current CEO Elon Musk, we're sorry. There's a lot to know about the case (like what's in the complaint), and we're going to dig as deep as is reasonable as things move forward. For now, the company is dismissing Eberhard's lawsuit as wrong and, basically, a mere nuisance. AutoblogGreen got the following from Tesla spokesperson Rachel Konrad:
This lawsuit is an unfair personal attack and, more importantly, paints an inaccurate picture of Tesla's history. It's a fictionalized account of Tesla's early years. To that extent, why not let Tesla's verifiable track record speak for itself? Since the new management team came on board last year, Tesla has achieved unprecedented success, right up to the delivery of the 500th vehicle earlier this month and the opening of a retail network spanning two continents. We spearheaded a strategic partnership with Germany's Daimler AG, an unquestionable validation of Tesla's business strategy and the strongest endorsement yet of the current management team's many achievements. We spent the past year relentlessly driving down Roadster unit costs and increasing supply chain efficiencies - to such success that Tesla is now widely considered the leanest automaker worldwide. We launched the Model S sedan and have received more reservations than even our own bullish internal estimates. These are all astounding triumphs for such a young company - and it shows just how much Tesla has grown in the past year alone.We''re not entirely sure what Tesla's recent "unprecedented success" has to do with Eberhard's accusations of libel and slander against Musk, but hopefully someone else will be able to connect the dots for us. In either case, stay tuned.
Finally, it goes without saying that this lawsuit will not have any effect on Tesla's considerable momentum or business strategy going forward.
Gallery: BRABUS Tesla Roadster
[Source: Tesla]
Reader Comments (Page 1 of 1)
jharlan 9:39AM (6/13/2009)
My guess is Tesla will quietly settle out of court for a lot of money unless Eberhard is more interested in Elon's blood than he is his money. Fighting this out in court can't be good for Tesla. I suspect Eberhard may have them by the balls on this one.
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km 9:53AM (6/13/2009)
Hopefully this doesn't sidetrack/financially ruin the company and cause it to fail.
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Nick P. 10:07AM (6/13/2009)
Lawsuits are normal occurrences in the corporate world. Apple, Google & M$ get sued every 10 second for all kind of things.
The only good side of this is that Tesla (like Apple, Google & M$) will hire a legal team to take care of such problems in the future before they hit the press.
I sympathize with both individuals & hope this gets resolved soon. Yeah, Nicolas Tesla himself had early legal problems...
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DF 10:18AM (6/13/2009)
I personally love to hear from Martin Eberhard, and I think a lot of people too. What makes me sick is to hear about the Musk guy. Strange that you asking that, you never questioned before if your readers were sick of you writing about the “Boer”. Maybe one of these days you can tell the public what really happened at Tesla….. Yes! I know what you are thinking but unfortunately I also, cannot tell.
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Yanquetino 12:23PM (6/13/2009)
Note to Rachel CONrad: When you say "fictionalized," do you mean like... say... that BS in physics from the U of Penn? Here's an idea: why not simply let AutoblogGreen post a scan of that diploma? That would certainly let the "record speak for itself." Hope to see it here soon!
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letstakeawalk 2:53PM (6/13/2009)
"...the company is dismissing Eberhard's lawsuit as wrong and, basically, a mere nuisance."
Tesla certainly would know what a nuisance lawsuit filed frivolously would look like. The suit Tesla filed against Fisker sure fit that description!
"The arbitrator's initial ruling in the case -- issued Friday -- is that "the evidence is overwhelming that Fisker did nothing wrong," Fisker spokeswoman Sylvia Navarro said in a release e-mailed on Sunday and embargoed until this morning.
She said the arbitrator's ruling specifically stated that "Tesla's assertion of violations of the Uniform Trade Secrets Act by Fisker were baseless and neither brought nor pursued in good faith."
http://blogs.edmunds.com/greencaradvisor/2008/11/fisker-says-he-and-his-companies-exonerated-in-teslas-trade-secrets-lawsuit.html
While I admire Tesla's product, I have little respect for Mr. Musk.
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Tohe 3:32PM (6/13/2009)
I much rather read about Martin Eberhard being successful on his own right, wasn't he developing a parallel business and developing personal charging stations? This lawsuit is not going to get him anywhere, it is not like the Board of Directors at Tesla acted illegally when they chose to let Mr. Eberhard go. His slander claims will be hard to prove, but even if he is able to, I think Mr. Musk will be happy to pay out of his pocket for whatever damages the court might concede Mr. Eberhard.
Today's Tesla is not the Tesla Mr. Eberhard helped create, it is a more complex, thriving young company, this is Elon's Tesla.
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mister nomer 5:58PM (6/13/2009)
Tohe: "This lawsuit is not going to get him anywhere..."
You never know.
Maybe Martin didn't want to fight this fight but is now finding it hard to get VC funding for his latest venture because of what Elon has said about him. That is, people don't want to risk their money with someone who has a negative image.
Maybe filing this lawsuit will allow Martin to get his version out there, get some of his reputation back, and attract the VC funding he needs.
mister nomer 6:11PM (6/13/2009)
On 2nd reading, I saw how my comment could be misinterpreted. Just to clarify:
I'm not saying that the objective of Martin's lawsuit is to attract VC funding.
I'm saying that the lawsuit may be to remove an obstacle (a bad reputation) that is preventing him from getting or hindering him in the pursuit of VC funding right now.
A subtle difference but an important one.
Tohe 6:42PM (6/13/2009)
@mister nomer
I understand and agree with your point, but by that same notion this lawsuit has the potential to go either way, once Mr. Eberhard puts his reputation in the hands of the courts, it is out of his. Perhaps Mr. Eberhard feels he is got nothing to lose, that is his call. I just feel he would be better off taking the high road. With that said, I don't know what Mr. Eberhard's circumstances are and I'm certainly not one to judge.
jzj 6:18PM (6/13/2009)
I respectfully disagree with Mister Nomer: demonstrating his litigious nature through a libel suit (which is by definition about alleged personal affront and thus more amorphous and squishier than a hard-facts breach of contract action) is exactly the thing that will prevent Eberhard from ever getting VC.
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stevejust 5:34PM (6/15/2009)
So you'd invest in a CEO that shows a tendency to roll over and let people take advantage of him?
It really goes both ways.
I for one don't think the lawsuit is about generating enough money for it to be anything other than an attempt to correct the alleged revisionist history of Musk inventing Tesla Motors.
If you add up the value of the loss of the #2 car (probably can't get damages for losing the #1 car, 'cause Eberhard had already rolled over on that and let Musk take it) that's only, maybe at best $2 million. There's a few hundred thousand at stake in the lost wages for not being on the advisory board, and then there's the 250,000 stock options which will probably be worth more than the lost wages and lost #2 Roadster combined -- but could be worth virtually nothing. If I told you 10 months ago that GM and Chrysler would be bankrupt, you wouldn't believe it. Tesla as a start-up is always much more vulnerable than those behemoths.
I doubt that the attorney representing Eberhard is doing this on a contingency basis, so the fees Eberhard might be paying could eat up into the actual money at stake pretty quickly. So, I don't think it's about the money. I do think it's about his loss of goodwill.
duinne eile 9:22PM (6/13/2009)
Let the future tell the truth, and evaluate each according to his own accomplishments. The present is theirs, the future, for which I have really worked, is mine
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TANKD0G 9:21AM (6/15/2009)
In the court of public opinion, Musky has already lost.
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flash 7:34PM (7/30/2009)
A good liar tells mostly the truth, with enough falsehood tossed in to add a completely different meaning. The part that is mostly true can be verified ... but unless you really pay attention you don't see the lies. Take the "dropped out of Standford" claim by Musk ... he provides a letter saying he was "accepted" but never "enrolled." You can't drop out of Stanford if you never enrolled. Take the "degree in physics from Penn" claim by Musk ... he provides evidence that he got degress from Penn. I don't see the words "BS in Physics" anywhere in the documents. So these statements are "mostly true" but when examined in detail, are not true. The whole "founder" issue can similarly be checked with public documents. Tesla was founded in 2003. Musk first became involved and invested in April 2004. It is pretty easy to verify this despite Musk's claims as founder. He was simply the first large investor (and that does give him claim to having an important part in building the company Eberhard and Tarpenning founded into the company it is today). But -- no matter what Musk says about being a founder, it remains as true and real as the Physics degree and the dropping out of Standford comments -- mostly true, which simply makes them good lies.
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