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Martin Eberhard sues Elon Musk and Tesla Motors

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Is he saying here that ME invested in a struggling ACP and brought about their use of laptop batteries? I thought he came to them after they had already done that and proposed to bring it to market?

DavidV is not the only one. This topic was covered in Tesla's wild ride (pg. 2) - Jul. 10, 2008

... Though the tzero could go 0 to 60 mph in 4.1 seconds, it was loaded to the gills with 1,000 pounds of lead-acid batteries, so its range was limited to 60 or so miles of driving.

At the time, AC Propulsion was struggling to keep its lights on, so Eberhard proposed a deal: In exchange for a $150,000 investment, he wanted Cocconi to try powering the tzero with thousands of lithium ion laptop batteries, which were lighter and had six times more energy per pound than the lead-acid variety. (It was an easy sell: Cocconi was already experimenting with lithium ion.)
 
If that were the case, then siry's mentioning of ACP as the beginners of the trend would be inaccurate no? Basically ME's idea is what ACP used for the T-Zero so that would basically make him the grandfather of that idea in that particular situation.

It would also mean that whether they had to redo Martin's work or not, he DID bring the base idea (well, expedite its use), which is commodity Li ion cells
 
If that were the case, then siry's mentioning of ACP as the beginners of the trend would be inaccurate no?
I would not necessarily reach that conclusion. If by "trend" you mean "idea", then his statement:
... that neither Martin Eberhard or Elon Musk came up with the idea of an electric sportscar [sic] with excellent range and amazing acceleration
appears to be "technically" true. On the other hand, the following statement:
AC Propulsion developed the idea, and both Eberhard and Musk initially approached the San Dimas, California, company to build the car. Tom Gage and Alan Cocconi had built the t zero, which is essentially the prototypical Tesla Roadster with a 0-60 time of 3.6 seconds and a range of more than 200 miles using commodity lithium-ion cells.
Omits the history (at least the "version" that is documented) behind incorporating commodity li-ion cells into t-zero prototype.

It would also mean that whether they had to redo Martin's work or not, he DID bring the base idea (well, expedite its use), which is commodity Li ion cells
We are in agreement here. In fact, I would be curious to know how large of a factor this was in EM's decision to fund ME and MT's venture versus starting his own, which seems to be more typical of him.
 
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I'm not trying to say "I told you so" (really, I'm not...), but I did mention this in post #164 on this thread...

http://www.teslamotorsclub.com/31396-post164.html

Indeed you did. I think I glossed over that as a couple of the posts surrounding yours didn't look familiar either.

We are in agreement here. In fact, I would be curious to know how large of a factor this was in EM's decision to fund ME and MT's venture versus starting his own, which seems to be more typical of him.

Probably much, but maybe moreso the fact that ME had the idea and technical know-how too. By his own admission EM was busy with SpaceX and left most of the Tesla day-to-day to ME. I wonder if a proper CEO or CFO had been hired and ME has been left to tinker if things would've gone smoother and EM and ME would still get along today.

It seems a lot of the animosity came about when it was "discovered" that ME had made some mistakes as CEO. Ah if time could be rewound.
 
Re: the idea for using commodity li-ion cells for the t-zero - I researched that point when I wrote the piece for Wired and ACP sources told me directly that it was their idea and that they had already been experimenting with li-ion commodity cells. They said Martin's investment helped them implement it, but the idea was theirs.
 
For those who missed the irony here - Siry takes great pains in his article to highlight that titles don't really matter. But, in the same piece he annoints himself as the former "Chief Marketing Officer" of Tesla -- a title that he never held. Siry's last title at Tesla was SVP of Sales, Marketing & Service. Could you provide an explanation of your use of titles, Darryl?
 
For those who missed the irony here - Siry takes great pains in his article to highlight that titles don't really matter. But, in the same piece he annoints himself as the former "Chief Marketing Officer" of Tesla -- a title that he never held. Siry's last title at Tesla was SVP of Sales, Marketing & Service. Could you provide an explanation of your use of titles, Darryl?

Who cares about titles? You can give yourself whatever title you want. That and $4 will get you a latte at Starbucks.

I don't doubt Darryl Siry having multiple titles. SVP and Chief of whatever is a fairly common dual title to have. The regular VPs are not CTO, CIO, CFO or COO or a C level title. It is common for a C level executive to also be a senior vice president within the corporate structure.

It is common for the CFO to also have a title of SVP of Finance.
It is common for the CIO/CTO to also have a title of Senior Vice President of Technology (or Information or both).

The titles that people use are just marketing for your resume.
 
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@rogerred here's my explanation:

"CMO" has 3 letters.

"SVP Global Sales, Marketing and Service" has 33 letters and is very unwieldy.

If CMO were somehow a bigger role than my actual role, you might have something, but its not.

And in any case, I agree with James. Who cares?
 
Darryl - thanks for the explanation. I think a lot people would not agree that lying about your title is okay because you feel that you performed the duties of a person with such title. Some people may disagree, but most will see it for exactly what it is and what you've admitted it to be - a fraud.
 
Tesla Strikes Back At Eberhard In Court - Business Insider

Tesla legally fired back at estranged co-founder Martin Eberhard, filing a motion in California to get Eberhard's lawsuit thrown out.

Tesla is not making a counter claim, rather it is filing an anti-SLAPP motion. SLAPP stands for Strategic Lawsuit Against Public Participation. It means Eberhard is suing just to initimidate and silence Tesla.



.
 
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I haven't read the motions, but Wired seems to have the most comprehensive summary.

Tesla Fires Back In Eberhard Lawsuit | Autopia | Wired.com

...
Besides arguing that Eberhard was a poor CEO who “left the company’s finances in shambles,” Tesla claims Eberhard’s litany of complaints (.pdf) — which include libel, slander and breach of contract — have no basis in fact. What’s more, the company says, both Eberhard and Musk have a First Amendment right to state, and debate, their versions of the company’s history. Eberhard has wasted no chance to do so, the company claims, and should not deny Musk the same opportunity.

“His lawsuit is nothing more than an attempt to curb open discourse on matters of importance to the public and to extract money from Tesla in the bargain,” the motions (.pdf and .pdf), filed in San Mateo County, Calif., Superior Court, state. “He also takes the extraordinary (and hypocritical) step of seeking an injunction that would prevent Musk from exercising his free speech rights in public or in private.”
...

Musk “agreed to join in the creation of Tesla” after convincing the other men the company should create the Roadster to prove the viability of electric cars and then focus on developing a family sedan.
...

Once the company was up and running, Musk says in the motions, Eberhard “sought to become the ‘face’ of the company,” publishing a blog, appearing on television, being profiled in magazines and testifying before Congress. But, Musk claims, Eberhard wasn’t minding the store.

“Although Eberhard had successfully captured widespread public interest and media attention, he was far less successful at actually doing the work needed at Tesla — developing a production-ready vehicle in a cost-effective manner,” the motion states. “Musk developed serious concerns about aspects of Eberhard’s performance as CEO, and he became increasingly convinced that Eberhard lacked the management skills and judgement that would be necessary to accomplish the complex tasks of turning their shared vision into reality.”
...

Tesla says he [Eberhard] forfeited the severance after writing a blog post disparaging the company’s management, a violation of his separation agreement with the company.

Musk makes no apologies for anything he’s said about Eberhard, but motion notes “almost immediately after his removal, Eberhard undertook a campaign of publicly disparaging Tesla and Musk.”
...

A few others:

Tesla Fires Back at Founder, This Time in Court Calling for Dismissal - earth2tech

Suit charges defamation | San Francisco Examiner

Tesla files motion for dismissal of Eberhard lawsuit - AutoblogGreen
 
As I have been writing code all day and really don't want to read those documents (no matter how many lines they've spaced), I'll wait patiently for a summary :)

That's what I'm here for! :biggrin::tongue:

There's really nothing surprising in the responses from EM and TM. Of the two documents, the first one (the "Demurrer" -- which is a fancy way of saying they're pressuring testing the validity of the Complaint) is arguing a lot of technical points regarding whether ME's claims are for "wages" or not. We should all ignore this -- it's a highly relevant legal question because if any of the money allegedly owed ME are "wages", the amount he could receive is much greater under California law because there are greater penalties for failing to pay a "wage" as opposed to a contractual amount owed (such as severance). (n.b., California law is totally insane on this stuff -- in the employment law field, we call it the "People's Republic of California" because these employment statutes are so difficult for employers to comply with). TM's arguments are fairly strong on these points, although as they note, much of this discussion is "arguendo", meaning that it only comes into play if ME is owed anything at all, which is a threshold question that needs to be addressed before determining any damages.

There are a couple of interesting arguments in the Demurrer -- first, that ME isn't entitled to his severance or stock options because (as he admitted in his Complaint) he disparaged TM and EM in his blog post. His severance agreement had a non-disparagement clause, so therefore he isn't entitled to his remaining severance payments or stock options. As discussed previously, TM and EM are on fairly solid legal ground on this argument, but it's kind of a dick-ish move (technical legal term :wink:) over one blog post that was fairly promptly removed upon request. A judge looking to throw a bone to the plaintiff might read into such an agreement a reasonable "cure" provision, meaning that it's not a breach if ME promptly cured the problem by deleting the post (which he apparently did). It will really depend on how hard-ass the judge is and whether s/he will rule on the strict letter of the contract and law, or try to give ME something by ruling for him on this issue.

The Demurrer also argues that the drive train was already upgraded, so there's nothing for ME to really claim here, other than sour grapes. That's a pretty solid legal argument.

The anti-SLAPP document is much more interesting -- I had forgotten about California's strong anti-SLAPP law, and this was an excellent use of it by EM and TM's attorneys. Basically, the anti-SLAPP law says you can't file a lawsuit against someone for exercising their free speech rights about something important to the public interest. Without counter-suing, EM has put the pressure back on ME because there are damages against ME if he is found liable for violating the anti-SLAPP law. In order to qualify under the anti-SLAPP law, the statements had to be about something "in the public interest." That's a fairly broadly defined term, and the production of the first EV vehicle of its type and range probably would qualify.

In addition, EM takes the opportunity to "set the record straight" from his perspective by telling a lot of seemingly irrelevant (to the legal case) facts about the founding and buildup of TM and the Roadster, and ME and EM's roles in that. I'm sure it was cathartic for him to make that declaration and get these facts "on the record."

EM's lawyers may have overlooked something on the defamation claim -- they assume that ME is a "public figure", which places a much higher burden on them to prove that EM's statements were defamatory because they then require "malice". They do not provide a fallback argument of "even if ME isn't a public figure, it's still not defamation because ....", which I definitely would have done if I were them. Strategically, that was probably a mistake, because I'm not 100% certain that they can prove that ME was a "public figure" (think of the typical "public figure" being a movie star with a defaming story in the National Enquirer). If I were ME's lawyers, I would immediately pounce on this and say ME is not a traditional "public figure" and a lower standard applies, and because EM didn't address that standard in his response, that claim should survive.

However, EM then makes his strongest legal arguments on why no defamation occurred -- (1) the statements alleged weren't made by EM (which was a glaring weakness in ME's Complaint), and (2) some of the alleged false statements weren't about ME, but about EM (such as when he graduated college). Technically, ME put that in the Complaint to demonstrate EM's propensity for lying, but that's a fairly weak argument to make and was an easy softball for EM to hit in this motion. Finally, (3) EM argues that many of the alleged defamatory statements are opinion and not fact, and/or (4) are not categorically false statements.

All in all, this is a thorough response, and gives EM and TM the decided advantage in the case, with the burden weighing heavily on ME to prove his case. With TM paying the bills (EM didn't even bother getting separate counsel -- Wilson Sonsini is representing both he and TM), I predict it will be a very long, hard slog for ME to pursue and win anything substantial on these claims, and he faces the legitimate possibility of having to pay EM/TM and/or their lawyers as a matter of course in having the Demurrer granted in whole or in part, or through the anti-SLAPP law. I imagine even a small payment would be a giant slap in the face to ME under these circumstances.
 
Thanks for the legal breakdown :)

Apparently the anti-SLAPP thing was expected, so presumably ME's lawyers have a strong counter-counter-argument prepared.

I wonder how long they can go back and forth like this before something meaningful happens?

-Ryan
 
Basically, the anti-SLAPP law says you can't file a lawsuit against someone for exercising their free speech rights about something important to the public interest.

I must have missed something. I thought the main goal of ME's lawsuit was to show that he is entitled to "founder" status, and that EM has harmed his reputation with false statements about his character. So, if this is indeed what happened, how is that an exercise of EM's right to free speech about something in the public interest? How is ME's status relevant to the public interest?

EM's lawyers may have overlooked something on the defamation claim -- they assume that ME is a "public figure", which places a much higher burden on them to prove that EM's statements were defamatory because they then require "malice".

First, it looks like you made a typo here, but I can't quite place it. The statement just doesn't make sense. Maybe you meant to say "not defamatory"?
Secondly, I would agree that ME is not necessarily able to be considered a "public figure". Out of the general population, I doubt anyone knew who he was except for us "EV geeks" and the few in the business.

I wonder if there's a chance for ME to argue that the non-disparagement clause was null and void and a tactic to suppress his right to free speech? Just curious as to his options there.
 
hehe

Having paid Wilson Sonsini bills first hand I can tell you those guys are NOT cheap. I'd not want to be payying that bill if I was ME. Wilson Sonsini had a great cafeteria back in 2000-2002 used to love to stop by for lunch.