By Matthew Russell Lee, Patreon Maxwell Book
BBC-Guardian UK - Honduras - ESPN NY Mag
SDNY COURTHOUSE, Sept 12 – In JP Morgan Chase's lawsuit against Tesla, about Elon Musk's tweet saying he would take Tesla private, the bank asked to file a motion for judgment on the pleadings.
On May 4 U.S. District Court for the Southern District of New York Judge Paul G. Gardephe convened an in-person proceeding, which Inner City Press attended and live tweeted it, below.
In September 2022 in a joint letter Musk's Tesla complained that JPM Chase "contrived to manufacture a purported 'impasse' as a pretext to file [a] motion." On September 12, Chase asked that the whole matter evade Judge Gardephe and go to Magistrate Ona T. Wang. [While amid jury selection in the criminal trial of Tesla-competitor Nikola's Trevor Milton, which saw the dismissal of a prospective juror for links to Tesla.]
From May 4: Judge Gardephe said, in essence, that Chase's claim is not susceptible to judgment on the pleadings. He is entering a case management plan and will meet again with the parties in 90 days - pending letter(s) from the parties. Inner City Press' live tweeted #MaximumMusk thread:
Judge Gardphe: Tesla has asserts a counter-claim. JPM Chase has filed a pre-motion letter seeking to file a motion for judgment on the pleading. I don't think the case is appropriate for that. Expert discovery will be needed.
Judge Gardephe: I asked JPM Chase to let me know if in a week if, despite what I've said, they desire to file the motion and why.
Judge Gardephe: The agreements do not define commercially-reasonable methods.... Musk tweeted, "Am considering taking Tesla private... funding secured."
[Funny to be transcribing this on Twitter, for which Musk also says, seemingly with basis, "funding secured"]
Judge Gardephe: Tesla published a blog post attributed to Musk reversing position. JPM Chase revised the strike price after the blog post, and gave Tesla notice of the adjustment. Tesla objected to both. Tesla seeks a declaration that JPM Chase violated its duty.
Judge Gardephe: JPM Chase says it is entitled to a judgment as a matter of law. Assuming arguendo that the tweet constituted an "announcement event" under the agreement - I will focus on whether JPM Chase can show it was commercially reasonable as a matter of law
Judge Gardephe: Expert testimony on what is commercially reasonable in the industry is likely necessary. Tesla disputes the reasonableness of Chase's methodology.
Judge Gardephe: This issue not susceptible to judgment on the pleadings. [Citing a State Street case before the 2d Circuit in 2013]. Chase cited a case that does not turn on commercial reasonableness.
Judge Gardephe: I do not believe that a motion for judgment on the pleadings is productive. So I intend to answer a case management plan. I will meet with you again in about 90 days time to make sure discovery is proceeding. Chase's lawyer: I respectfully disagree
JPM Chase's lawyer [from David Polk] This is a unique case. Usually answers say very little, But here Tesla made counter claims, and so asserted facts. [Judge Gardephe has already read out his view, so it's not clear how effective this presentation is going to be Judge Gardephe: Sorry, we have a jury out, I got a note [in Hezbollah case of US v. Saab, which Inner City Press is covering here - as well as a Lebanese money laundering case with a proposed suretor from JPM Chase in Tampa, here
Tesla / Musk's lawyer from Quinn Emanuel : This case isn't subject to judgment on the pleadings. Full disclosure: Quinn Emanuel, pro bono, has written to UN (and emailed the US State Department ) seeking to get Inner City Press back into UN - no answer, video Q here.
Judge Gardephe: I haven't rule per se. I look for a letter from JPM Chase, the defense [Telsa] could put in a letter too.
On May 17 a case management plan was submitted and endorsed: "Counsel for the parties have conferred and their present best estimate of the length of trial is: 5 days. Deposition due by 9/14/2022. Fact Discovery due by 9/14/2022. Expert Discovery due by 12/2/2022. Pretrial Conference set for 10/6/2022 at 10:45 AM in Courtroom 705, 40 Centre Street, New York, NY 10007 before Judge Paul G. Gardephe. (Signed by Judge Paul G. Gardephe on 5/17/2022) In addition to the issues raised by the Court at the pre-motion conference, the parties' briefs should address whether judgment on the pleadings may be granted only as to certain issues. SO ORDERED by Judge Paul G. Gardephe on 5/17/2022
Inner City Press is tracking the docket. Watch this site.
The case is JPMorgan Chase Bank, National Association, London Branch v. Tesla, Inc., 21-cv-9441 (Gardephe)
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