OA663: Elon Dumps 42 Million More Shares of Tesla

Transcript

This transcript was generated automatically and may contain errors — the audio is the record.

0:01:17 Thomas: Hello and welcome to opening arguments. This is episode 663. I'm Thomas. That's Andrew. How you doing my friend?

0:01:24 Andrew: I am fantastic, Thomas, how are you?

0:01:26 Thomas: I am doing well. I excited for today's show. By the way, if you haven't heard it already patrons, go check out Lotawful Media. We did Trial by Jury, a really bad 90s movie, movie.

0:01:30 Andrew: Me too, really 90s, 90s.

0:01:41 Thomas: It was it, and it's the perfect lamb because it takes itself intensely seriously. It has parts where you're like, "Oh, this is a movie," but it's just not, you know, it's a kind of a rip off of everything. It's, it's great, it was really fun, uh, very proud of that one. Go on patreon.com/law at the two dollar level and you get that lot off of movies. And let's see, other announcements, oh, you still have time while you're doing that to go check out the Q&A thread for the the Patreon YouTube Q&A we try to do every month, and that's tomorrow or maybe today, Friday the 16th, 4 p.m. Pacific, 7 p.m. Eastern. Again, patrons are the only ones who can ask the questions on the Patreon thread, but everybody can come hang out, chat, do all that stuff, find out what Andrew's drinking on a given night.

0:01:45 Andrew: Oh, gosh, yeah. Yeah, yeah, last, last Q&A before the holidays, if, you know, if you celebrate holidays this time of year, and, should be a lot of fun. Last couple of Q&As, we've had a pretty big attendance, so that's been a lot of fun, you and should show up. We tweet out the YouTube link over social media, but just go to YouTube and look for Opening Arguments, it's and a lot of fun

0:02:49 Thomas: And while we're on the topic of holidays announcement, we're going to a break from our four-episode schedule for the holiday weeks. I we're still doing two episodes a week, but we're just going to not do four episodes a week for the couple of weeks that are the holidays, I

0:02:58 Andrew: Right. Yeah. You'll get only the usual output.

0:03:06 Thomas: Yeah. Yeah. Instead of working double overtime, we'RE just going TO do single overtime, you know, for the holidays. So, look, one more thing you want to do? Tease what we're talking about on Tuesday, Andrew.

0:03:13 Andrew: Correct. Yeah, exactly right. Yeah. Lots of people already asking about the lawsuit filed by big time loser Carrie Lake in Arizona. And we will be covering that and kind of the general vibe of the thing of lawsuits to protect our democracy.

0:03:34 Thomas: Yeah, well, because this one's gonna work, though, I think this time. She's gonna be governor or whatever, I think, yeah.

0:03:38 Andrew: Oh, yeah. Yeah. After being sanctioned last time, I'm I'm real sure that this one's going to go over great. So.

0:03:47 Thomas: This is the one that'll do it. Sorry to spoil the conclusion, everybody, but on Tuesday, we're going to announce that Carrie Lake is governor, that's... but you, you know, tune in for why.

0:03:52 Andrew: Oh, yeah.

0:03:59 Clip: Down the law, down the law.

0:04:02 Thomas: So Andrew, we have some updates in Trump's flailings to avoid. I mean, we can't knock his flailing ability. Like he's flailed for six years to to somehow avoid consequences. Um, on him. However, the flailing is getting more flailish. So what's going on in this one?

0:04:13 Andrew: Yeah. This is the lawsuit. I can't even say the lawsuit in Florida because there are like 20 frivolous Trump lawsuits in Florida. This is the one in which Trump and his idiot lawyers went down to Florida hoping to get Judge Cannon and drew Judge Middlebrooks instead, the same Judge MiddleBrooks who issued sanctions in their frivolous lawsuit against Hillary Clinton and all of humanity in connection with existing. This was seeking injunctive relief. We've covered it on the show a bunch of times, but this is seeking injjunctive relief, preventing New York Attorney General Letitia James from receiving information regarding the Trump revocable trust, which he moved from New York to Florida in the middle of Tish James's investigation.

0:05:11 Andrew: And if you're thinking, hey, can a federal court in Florida issue injunctive relief against a state official in New York in connection with legal proceedings in federal court? The answer is no, obviously not. This is idiotic. And the last time we talked about this, we mentioned sort of the five arguments that the New York attorney general's office had advanced in opposing Trump's, quote, emergency motion for injunctive relief, which, by the way, Judge Middlebrooks has not expedited in any way. That's a real good sign that the court is not super interested in awarding you emergency injunctive relief. Right.

0:05:51 Andrew: Hey, why don't you guys take, you know, a month and a half to brief this up? So we mentioned at that time that there were really five arguments that were made. There were four sort of threshold knock this case out. Right. Lack of personal jurisdiction because Letitia James was named individually. Sovereign immunity by the state of New York. The Rooker versus Feldman doctrine. All of that stuff. And we covered that two weeks ago. Go. Thomas, I'm here to tell you that Trump's idiot lawyers have figured out the one weird trick that they can get around all of that. No, no, no. No. No they have not. By the way, when I say Trump's Idiot Lawyers, again, that is insufficiently precise. Even Trump's Idiot lawyers in Florida doesn't narrow down which set of idiot lawyers they are.

0:05:51 Thomas: Oh yeah.

0:06:38 Thomas: Gosh, with his lawyers, you know, it's like my fantasy football team where, you know, everyone blows out their knee every week or gets a concussion. So I don't even remember who's on my team. Uh, that's like with Trump's lawyers team. It's like, all right, who hasn't been sanctioned? Anybody hold it on, hold your hands up. If you're still allowed to practice law. You, sir.

0:06:38 Andrew: Uh,

0:06:56 Thomas: Okay. You're my lawyer this week. Wow.

0:06:56 Andrew: And I think they should be measured in weeks. This is a Florida firm called Weber Crab. And we have talked about the person who is clearly connected to Trump world, a young lawyer named R. Quincy Byrd. Spoiler for next Thursday when we have Liz Dye back on the show. This is the only law firm that was dumb enough to sign on for Trump's now actually filed lawsuit against the Pulitzer Prize Committee. Oh boy, are you going to strap in for that one? That's going to be amazing in every conceivable way. So, But the word yet is doing a lot of heavy lifting in that sentence. So here's what you need to know about the response that just summarizes it in its entirety.

0:07:47 Andrew: Remember that the initial request for injunctive relief names Letitia James personally. And so among many other things, the opposition brief said, "This is really a lawsuit against the Attorney General's office, which is protected by sovereign immunity." Well, nope. Trump has come back and said, "No, I am definitely 100 percent suing her for her personal vendetta to stop her from filing an action in the New York courts in order to access the revocable trust documents." So this is page three of the brief. Trump's lawyers have said, "James's remaining arguments for dismissal all rely on her attempt to recast the amended complaint as an official capacity suit brought against the New York office of the Attorney General, rather than an individual capacity claim against James," for her unconstitutional behavior. Yeah.

0:07:54 Thomas: Yeah.

0:08:45 Thomas: Rather than something way stupider.

0:08:49 Andrew: James attempts to characterize plaintiff's claim as challenging the, quote, "investigation" or the, quote, "New York enforcement action." However, it encompasses a far broader, sustained campaign by James to abuse her office for personal gain at the expense of plaintiff, which was conceived and announced before James's election to state office or the congressional testimony of since-disgraced Michael Cohen, to which she points as the beginning of the facts in this case, and continues, continues to this day.

0:09:16 Thomas: Yeah. So it's like Letitia James or their team tried to turn it into something that would make a tiny bit of sense. And their angry response is no, no, we, we were, we're doing a dumber thing. Don't, don't try to paint us as doing a thing that makes any sense. Come on.

0:09:17 Andrew: Yeah, We we stand by our ignorant pleadings. Yeah, that is exactly right. It is bonkers, as you might suspect, right? The whole reason that there is a legal doctrine about the difference between between suing a public official in their official capacity or in their personal capacity has to do with the gravamen of the complaint. And what they object to here is getting money in connection with the investigation. The allegation, without foundation, by the way, that Letitia James is on an unconstitutional witch hunter. I don't know. You can make that part of the basis of a motion to recuse, which they filed twice and have failed.

Right. But that doesn't convert. Right, an elected official hates you personally when they are conducting their official duties, does not mean they are not conducting their official duties. So stay tuned on. But that, this is also, I think, going to dovetail very nicely with next Tuesday's uh Dominion sanctions, because it's really the same question, right? That is, can you go into a court and get a federal court in one jurisdiction to tell state officials what they can and cannot do? And, spoiler, the answer that is not just no, but sanctionably no, right? You should know better than to try and do this.

0:10:21 Thomas: Yeah. Yeah, I an answer on the bar exam should be not just no, but sanctionsably no. And it's only because of this Kraken bullshit. Is it still Kraken? No, it's not Kraken. What is this iteration of?

0:10:58 Andrew: These are now, sub crack in level, right? Like, it's

0:11:07 Thomas: So Kraken, All right. Well, that's stupid. That Next item. Oh yes. The, uh, Rachel Maddow suit that we covered. Uh, I love that deep dive. It was really interesting. I felt like I learned a lot on that one and now NBC has filed their answer. So, uh. What do we have to talk about from that?

0:11:08 Andrew: Yeah, indeed, it is Remember that the answer to a complaint is usually pretty technical, but I think this gives us, there are three or four paragraphs that are pretty interesting in terms of demonstrating what NBC's strategy is going to be in this lawsuit, which, spoiler alert, is exactly what he told you it was going to be. First are paragraphs two and three, the answer to paragraph two and three, which I should mention, they dropped this in a footnote. The legal language that you use when you are answering a complaint and you, you are less than certain about what discovery might show is this boilerplate language, right? I use this all the time and it's absolutely appropriate practice. And that is, NBC lacks information sufficient to form a belief as to the truth or falsity of the allegations in X paragraph, and on that basis denies them, right.

0:12:22 Andrew: And the reason that you phrase it that is because the plaintiff has the burden of proof, right? If it's 50-50 or less, then you walk regardless of what it is. So when, know, let's use the example we use all the time of you trespassing on my property. If you are 100% certain, let'S say, Say, you know, you were in Bora Bora the day I accused you of trespassing on my property. You might say, I deny that.

0:12:52 Thomas: I did not have sexual relations with that woman.

0:12:53 Andrew: Yeah, right. Yeah, exactly. You would say, I deny the allegations of Paragraph 7 saying that I trespassed on your property on July 17th, 2021. But even if you know you weren't at my house that day, right, or even if You're like 99%, like, If you don't have that absolute knockdown certainty, you would use this kind of language because then if something comes up in discovery, it turns out you forgot that you actually dropped off a package at my house that day. You were running a bunch of, look, this happens.

0:13:22 Thomas: Yeah. Yeah.

0:13:25 Andrew: It's year and a half ago. You were run on a bunch errands. You dropped off something. You were actually in my driveway for three minutes. And now, you know, I can, yeah, I can say, oh, well, you know, didn't you under penalty of perjury in your official denial say that you've never been to the, okay, well you know. Oh, sure, it was just a couple of minutes, but like, you which Thomas should we believe? The one who was lying in the answer to the complaint or the person who's testifying now, you know? Right, exactly.

0:13:33 Thomas: Now you look like a liar.

0:13:56 Andrew: I'm confused. It's so good. So those specific paragraphs say, you know, we deny the allegations, except that NBC admits that the broadcast included the statement that plaintiff, quote, has refused to hand brackets the Dirk Hatch package over to the FBI, which is what you should do if you get something from somebody who is sanctioned by the U.S. as a Russian agent. Then paragraph three says NBC respectfully refers this court to the broadcast and to the DNI report, both identified in paragraph three of the complaint for their true content and meaning. NBC denies the allegations, except that NBC admits that the broadcast reported on and displayed the DNI report and admits that page three of the DNI report states that Dirk Hatch, Kalimnik and their associates sought to use prominent U.S.

0:13:50 Thomas: All right. Mrs. Simpson, I'm confused.

0:14:43 Andrew: Persons and media conduits to launder their narratives to U.S. officials and audiences. These Russian proxies met with and provided materials to Trump administration linked U.S. persons to advocate for formal investigations, hired a U.S. law firm to petition U.S. officials and attempted to make contact with several senior U.K. officials. So that was in the DNI report. And again, you see NBC basically teeing up a that these statements are substantially factually true or at minimum.

We were entitled to rely on the state of the reporting as of the time of the broadcast that there are two more interesting bits, one in paragraph 15, in which NBC says, quote, it admits that the conclusion included in the March 18th, 2021 broadcast that, quote, Quote, if you get something from somebody who is sanctioned by the U.S. as a Russian agent, you should hand it over to the FBI was an opinion based on accurate facts. So we've basically talked about the like only issue remaining is was Rachel Maddow entitled to imply that Devin Nunes refused to turn over the Dirk Hatch package to the F.B.I. something that Nunes has said he has done. It's something that we said, don't know. We

0:16:00 Thomas: Yeah.

0:16:00 Andrew: Just have Nunes' word. And that gets to the last part that I wanted to flag, which is NBC has taken that same approach, right? Like, in other words, date, other than Nunes saying, I gave that package to the FBI, there is no extrinsic corroboration.

0:16:15 Thomas: I did not have sexual relations with that package.

0:16:18 Andrew: Yeah, there's no extrincic corrobaration that he did, in fact, do so. So, Paragraph 24, which deals with that claim, says, says that NBC denyes the allegations, except that it admits that it received a demand for a retraction and apology from plaintiff Devin Nunes dated April 5th, 2021, which challenged statements from the broadcast. On April 9th, NBC responded to the demand for retraction in a letter to seek clarification of and support for plaintiff's position. Among other things, NBC specifically asked, quote, "Is it Congressman Nunes' position that he submitted the package to the FBI or another intelligence agency? If so, to which agency did Congressman Nunez submit the package and on what date? Was it in response to a request of the agency?" End of quote. Now, let me jump in here, this is precisely what you do when you are dealing with a good faith actor, and not Devin Nunes, in connection with a cease and desist, right? I say

0:16:22 Thomas: Yeah, point

0:17:11 Andrew: To you, hey, you said I sent a threatening letter, you said false stuff about me on your show, I demand a retraction, you say, okay, um, give me some evidence to show me.

0:17:22 Thomas: To me on the doll where I said false stuff.

0:17:23 Andrew: Right. Give me some evidence that I said actually false stuff. And any non frivolous plaintiff would respond back to that with, yes, it is my position that I submitted this to the FBI. That's the gravamen of what I'm claiming is false. And that did not happen here. The paragraph goes on to say NBC further stated in its response that, quote, "We would like to update our reporting on this matter as expeditiously impossible in light of your responses and the information in the demand for retraction, which we seek to clarify." Plaintiff Devin Nunes failed to respond to NBC's correspondence and did not provide NBC with any support for plaintiff's position, including a copy of the alleged letter to Mr. Barr. So, yeah, that is, again, when you talk about, as we did in our coverage, journalistic standards, somebody says to you, hey, this is false. You're entitled to say, OK, give us some indicia beyond you saying that it's false, that it'S false.

0:18:21 Thomas: Think the kids call this bringing receipts. We're

0:18:23 Andrew: Yeah, exactly. I want to see the receipts. So of course, brought no receipts and that's the position we're in right now. Like I said, I really think as opposed to I'm always telling you lawsuits are going to take longer to resolve than you think. I think this is going to take less time to resolve than you think, because after the filing of this answer, the court is going to set a discovery schedule and NBC is going to send requests for admission, interrogatories and requests for production of documents. And they're going to say, all right, give us the proof that you actually gave this.

0:19:03 Andrew: Yep. There you go. So. So, you I would say probably sometime in 2023, you're going to see an early motion for summary judgment to make this case go away. We have to see what the actual facts are on the ground. But, you have my suspicions as to what those might be. Uh.

0:19:02 Thomas: All Waiting. So, Are We getting to the point where where Rachel Maddow is gonna have to provide a bunch of internal emails and discovery or anything, or is this something that kind of takes precedence over that? Hmm.

0:19:30 Andrew: It depends on what happens in connection with your discovery requests are, that that sets a 30-day clock to respond from the moment that you receive that request. And, as I have alluded to before, courts really, really, really do not like to interfere in discovery requests, even if you're up up against a serial harassing litigant like Devin Nunes. So the answer to that question is it depends on how proactive Devin Nunes' lawyers are in getting discovery out the door. I will tell you, as the plaintiff, right, in cases where I have been counsel for the plaintiffs, I know I'm not allowed under federal rules of civil procedure to serve any discovery until the court issues a scheduling order.

0:20:19 Andrew: And so what I do is I have all my discovery drafted up, ready to go out the door the day that scheduling order is entered, right? Because I want to be first and I want to put the burden on the other side to have to answer and then, you know, figure out on my side which ones I'm going to answer a not based on, you the way in which they they, respond.

So all that long winded way of saying, if I were Devin Nunes's lawyers, I certainly would say, Yeah, we want the entire file related to this news item on this particular day. We want all the correspondence. We went all the research. We want all the communications. We want everything. Know, and NBC is going to have to turn that over.

But once we have that, once we're through kind of that first round of discovery and Nunes has either said in the answer to a request for admission, uh, or an interrogatory or, you know, has certified that he's produced all the documents, something that's getting Donald Trump in trouble, uh. That point, NBC will move for an early summary judgment and will say, look, we've got they've given us all the evidence they say there is for the proposition that Nunes, in fact, turned this over to the FBI. And we have produced all of our evidence indicating our reasonable due diligence in moving forward with that statement, which was never conclusively proved, you know, was never inclusively disproven until this litigation matters. So this obviously cannot be the basis for a defamation lawsuit against a public figure. And the court going is to agree with that. So it is really just a matter of time. And that clock is ticking.

0:21:57 Thomas: Can Maddow get aggressive and be like, oh yeah, we want some discovery, we want the cow files, give us, we move for the cow file?

0:22:06 Andrew: There is no doubt in my mind, if I were litigating against Devin Nunes, I would ensure that the typo of "move" with two O's made it into at least one of my pleadings. Just As a little

0:22:17 Thomas: Yeah. You've got good plausible deniability. Oh, just a, oh, my O key sticks a little bit.

0:22:20 Andrew: Absolutely. Oh, Yeah. Just, I just That's Sticky.

0:22:23 Thomas: Sorry about that.

0:22:24 Andrew: Yeah. There you go.

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0:24:16 Thomas: What's going on with Elon Musk dumping more shares? What's the OA angle on this?

0:24:21 Andrew: So one of the things that is available when you go to the SEC's website, right, the Securities and Exchange Commission, uh, they have a tool called Edgar, Edgar, that contains contains all of the public filings that companies make in connection with that public company. And so this is where I went to track the Twitter acquisition. Merger plan was filed. All of the relevant documents were filed. Every time Elon Musk said something stupid in connection with that filing, he had to file a notice to the SEC. Interestingly enough, when you search Edgar, the default is exclude insider transactions.

0:25:09 Andrew: It's just a little checkbox, right? And the reason for that is those things tend to be completely ministerial, That is member insiders, Right. Members of the company's board of directors must file when they acquire or dispose of significant amounts of shares of the company stock. Right. And the reason for doing that is really, really, really, really obvious if you are trying to nail down insider trading, you know, having a result of, Oh, Hey, on December 12th, I dumped the entirety of my holdings of this company stock on December 13th. You know, it was announced that we were going to miss our sales target.

0:25:55 Andrew: And in fact, that remains to this day, I don't know why insiders haven't gotten more clever in their insider trading, sort of the classic way in which insiders get prosecuted for insider trading. It is just that simple of a paper trail. So what that means is every time Elon Musk sells a significant amount of Tesla stock, Tesla has to file SEC Form 4. That reflects changes in beneficial ownership by company insiders. I want to tell you, as part of this story, you also need to know that other members of the Tesla Board of Directors are exercising their stock options, right?

0:26:41 Andrew: Because there's an A or a D code, so acquire or dispose. And so they are acquiring shares of stock, that is the A, by, you know, being able to buy to cash in their incentives and then immediately turning around and cashing out those incentives. And if you're thinking that seems like a weird time for insiders to be cashing out their incentives when Tesla is, as of this recording, trading at $157.93. That is just fractionally up from yesterday's 52-week low of $153.28 and closing in on 40% of where Tesla was before Elon Musk engaged in this entire fruitless Twitter activity. So, if you're looking at it going, you Tesla is still a fundamentally sound company. Again, don't take legal advice from a podcast. Definitely don't Take financial and investment advice from Right.

I am by no means qualified to opine on these things. My lay opinion, my non-professional opinion, upon which you should not rely at all, is longtime members of the board of directors of Tesla are comfortable getting out at the price that Tesla is currently trading, that seems to me to be an indication that they think this is a permanent condition. Right. This is not just, oh, you we've hit a low. It's going to hit 150 and then it's going to bounce right back up. And, you know, we'll be trading at 250 in no time because if it were, you their stock options, some of these, for example, are, $20 a share. Right. So because they're long standing options. So you would just hold on to

0:27:32 Thomas: Jeez. Sure.

0:28:32 Andrew: Your options until the the price goes back up unless, you you think that the price is likely to continue going down.

0:28:39 Thomas: Yeah. Unless you want to buy a boat or something. But I mean, if it's a lot of different of them, you wouldn't think that.

0:28:41 Andrew: Could be rep, but but yeah, yeah, you're

0:28:45 Thomas: Yeah, unless they're having a boat party. Maybe they're like, hey, everybody buy boats. No, I don't.

0:28:45 Andrew: Right. Exactly. So could, could be, could be A, you know, let's all have a boat party. All I'm saying is I'm keeping an eye on also members of the board of directors. Other Insiders.

0:28:50 Thomas: Yeah? Mm hmm. Which I imagine If you were an investor in any company, that's something you're going to keep an eye on, right? Just to gauge just what's going on. Yeah.

0:29:01 Andrew: Yeah. Absolutely. If you were somebody, if you were an investment broker, right, I can do this for my show, you ought to be doing this for your clients, would think so. This SEC Form 4 requires you as an insider to report, as we said, changes in beneficial ownership by company, company insiders, including Elon Musk. And there have been four of these filed by Elon Musk in the last five weeks. That is, post the Twitter acquisition, Elon Musk has continued to dump his Tesla stock. And this is really, really curious. So it's sort of worth delving into. The first tranche of dumping the stock was November 4th, 2022. Elon Musk came in with 465 million shares and sold approximately 9.7 million of those at an average of about what looks like $210 per share, slightly below what it was trading at.

0:29:14 Thomas: Yeah. Somebody making managing billions of dollars, can do it. I

0:30:15 Andrew: That's November 4th. Days later, November 7th, Musk gets rid of another 5.3 million shares. Right, again, this is all trading on November 7, uh, three days leader. Now the, the average price is about $202, $203 dollars a share and a low of $197. Right, so waiting three more days in for some of of these cost him $13 a share. And, and when you're dumping 5,500,000 shares, well, you know, that's a $55 million loss, which, you know, even billionaires kind of care about losing $55,000,000. The next day, November 8th, the sell-off continues. Musk dumps another 4,500,000 shares.

0:31:00 Andrew: And now the price is cratering at an average of about $193 a share. So one day loses another $10 in average share price. Sold some for as low as $189.5 on November 8th. And that takes us to to yesterday. So a three-day transaction report from December 12th through the 14th. And if you're asking how come this one is spread out over three days as opposed to two days, um, I looked and I tried to find it. It's possible that he sort of put in the cell order and couldn't find anybody to satisfy, um, that would be my speculation to the best of my- But, like, I couldn't find anything in the SEC regs allow you to report over three days.

0:31:52 Andrew: So that would be my speculation. In any event, this is a sell-off from December 12th, three transactions of about just a little over 3 million shares, through December 14th, which includes another 19 million shares for a total of 22 million shares at an average of about $165 a share, share, including 615,000 at 156.14, another 1.8 million at 155.95. That's below where Tesla is trading as of the timing of this record. So in other words, Elon Musk, in the span of the last five weeks, has gone from being the beneficial owner of 465 million shares of Tesla stock to 423 million shares. That is, sold off 42 million shares, 10% of his holdings, and converted that into cash. So, uh, number one, um, hey, the IRS, if you're listening, um, this is uh a tremendous amount of sell-off, notwithstanding, uh, preferential tax treatment for capital gains, which is crazy.

0:33:10 Thomas: Think he has some losses, uh, to use to offset this, though? Andrew, yeah.

0:33:13 Andrew: It, It, he, he does have some losses, uh, but, usually when you're sitting on a pool of

0:33:19 Thomas: For you're sitting on stock from when you founded the company or whatever, but from a long time ago, there's going to be some gains on, on those. I guess he didn't found Tesla, I guess.

0:33:23 Andrew: Yep. I would, I would think that there would be. So, uh, yeah but

0:33:31 Thomas: I should clarify

0:33:31 Andrew: Still he has options at a super, super low price. So, you all I'm saying is that if I worked at the IRS, I would certainly be paying paying attention to this, if nothing else.

0:33:32 Thomas: Yeah Yeah. Oh, well, we've solved that by not funding the IRS to be able to go after billionaires. So don't worry. So you're not working at the IRS.

0:33:48 Andrew: Oh, OK. Well, then.

0:33:50 Thomas: Or wait, do we get Biden's army of IRS agents that's going to go and, you know, knock down all of our doors? Did that happen yet or no? Hopefully it did.

0:33:58 Andrew: Oh, Time to check the notes on that one. Yeah, of this is a way of saying we have flagged the potential legal issues that await Elon Musk in connection with Twitter, but also in connection With Tesla. Right. This is a pretty strong indicator to me that Musk thinks that's a reality. Right? I'm reading a lot of tea leaves. I'm doing a lot lot of speculation but um it seems to me that time Tesla hits a new low I ask myself that question right, like, well, is this bottomed out yeah Is this artificially depressed uh because the news about Musk is so bad?

0:34:20 Thomas: Hmm.

0:34:32 Thomas: Is it time to buy? Yeah. Yeah. Yeah. Cause it's not actually, this this is a good thing to clarify. Here's the funny thing as someone who actually has some amount of expertise in finance, I know nothing about any financial news or anything. Cause actually the smart thing to do is to invest in certain, you indexed ETFs and all that, and just never look at it.

0:34:56 Andrew: Right.

0:34:57 Thomas: That's actually the smart financial thing to to do. And don't take financial advice from me, but that's my view of it. So I don't keep in the details of this.

0:35:00 Andrew: Right. Right. I got everything in crypto, baby.

0:35:06 Thomas: Yeah. So, I'm just buying up Trump NFTs. That's because I know a thing or two about investments. I don't pay huge attention to this, but the point of all this is, is there something going on Tesla? Forget that Elon Musk exists for a moment. Is there there's something going on with just the company of Tesla that would such be that you would expect like, oh yeah, this thing's cratering. Like, oh, the, the batteries give you cancer or the, you know, their factory closed down. You know, is there some, something that would actually explain this other than just his massive impact on the price just by being, you him and doing the weird crap he's doing kind of extracurricular stuff.

0:35:10 Andrew: Yeah. And I went looking for those sorts of stories and the only thing I could find were stories by Tesla employees who were quoted anonymously in various investment journals as saying, yeah, Musk is basically entirely absent here as a CEO. So it's

0:36:03 Thomas: Well, that's good News. That would cause me to invest everything he actually does is stupid. Like, guess the, there is the fact that like the autopilot's a scam and that's not going to actually work. Well, the, uh, the self-driving is just like that's never going to happen, but other than, I mean, that's kind of, I thought that was already priced in a little bit, but I could be wrong.

0:36:21 Andrew: Tough to say what's priced in and what isn't. All I can say is transaction history, if you were looking for evidence to support, oh, this is a blip and will rebound, that transaction mystery to me does not seem to support that factual claim. That's as far And as I'm comfortable going. But, know, that certainly seems to track with if you are looking at this, again, as an outsider and as a non-financial professional, would say that this is reflecting, you potential downside insecurities about what was. And again, I can't stress this highly enough. Nine months ago, the stock was trading at a thousand dollars a share before

0:36:22 Thomas: Yeah. Before

0:37:08 Andrew: A three for one split.

0:37:09 Thomas: The Split.

0:37:09 Andrew: So three hundred and Thirty three dollars. So it's less than half of where it was before these shenanigans started, and its 52 week high is like eleven hundred dollars, so I, and again, you know, you can, you divide by three, do the math. Um, so to see a company in a year-long free fall in which it's fallen in half in terms of its market cap and having have multiple members of the, the board of directors saying, yeah, we're still going to sell at this point.

0:37:09 Thomas: Yeah, important To Claire Yep.

0:37:41 Thomas: Because apart from the board of directors, I would have said my my, my speculation to you would have been, well, he's hemorrhaging money. He's, he's the expenses that he has in just interest of how he's financed all this garbage. I mean, that could be reason enough for him to just be like, I have to sell off. I have to sell off.

0:37:51 Andrew: Yep. Yep. Certainly could be. And that's why that's why I wanted to share both with you. Right. Because keeping a stockpile of billions of dollars, because as we have pointed out, right, we do not know the terms of the second rounds of what we know were the first round of loans that got canceled were secured against Tesla stock and had a margin call if Tesla stock fell below a certain price. And there was no doubt in my mind, right? Like, if that was the A team and the A Team pulls their loans, the B team is not offering you more favorable terms.

0:37:59 Thomas: Yeah, right. Exactly. Yeah. That's yeah.

0:38:28 Thomas: Yeah. And there were based on him having quite a lot more value in Tesla stock because the price kept tanking. So like it has to get worse and worse and how he had to be able to find that money in in terms of, what you interest he might owe. So that's what are you, you're essentially saying here though? Is it just that the company Tesla is in bad shape? I mean is that all we're

0:38:34 Andrew: Yep.

0:38:52 Andrew: I'm saying that the company Tesla could be subject to potential liabilities that are not otherwise disclosed in their 10Q, 10K filings and are thus driving the price down. What's an example of that? Well, an example of that could be, as we've talked about, a derivative shareholder lawsuit against in particular Elon Musk for failure to act in the best interests of shareholders,

0:39:23 Thomas: But how does that impact the company though? Wouldn't that just impact him?

0:39:25 Andrew: Because, no, because it is a, it is derivative against the board of directors and, or against Musk and the board OF directors, and their contracts contracts have indemnification clauses. So the company will then step in and defend.

0:39:39 Thomas: Oh, okay. Be a liability for the company. Yeah.

0:39:41 Andrew: Yeah. So that's, the reason that you do it. Can you, can you claw back bonuses from executives? Sure. But by and large, you are also as the shareholders, then getting money out of the company to reflect the losses that you've suffered in the stock market, which right in turn, Would cause additional expense and, you know, subsequent subsequent purchasers are less likely to buy stock at that point.

0:39:44 Thomas: Well, I love my Tesla and I hate Elon Musk. I feel, I mean, it's still a sound car.

0:40:14 Andrew: There is a, we could do. Yeah.

0:40:17 Thomas: Like there's obviously problems with the cars, but like it's, let's be real here, like it still makes a product that people want. It's probably because I'm in California where I am or whatever, but everybody drives a freaking Tesla here. It's crazy, um, there's a lot of them, so it's, I don't know, it's kind of interesting to me. I don't, what's, what's what to think about where, kind of what you said earlier, this is something that's always true about stocks and and the the markets, is you don't know. Like whenever there's a drop, a big drop, people will be like, "Ah, finally a market correction," because in their minds they have, like, okay, like the price earnings ratio has never been higher and it should be lower.

It's, but it's like, there's no real way to say that for sure. Like you can't really say what that ratio should be. You can just kind of look at history and you, those, it gets higher and higher. It seems like, but it's, it's hard to know what that means. So anyway, the point is, it's to know, what is just like, oh, this is a correction, and the price probably should be more like around here or whatever, versus no, this because of massive, massive Elon shenanigans. I really have no do

0:40:31 Andrew: And.

0:41:18 Andrew: Yeah.

0:41:18 Thomas: You have any sense of like what we should expect the price to be? I have no idea. Yeah.

0:41:19 Andrew: I don't know. No, all I know is I can continue to monitor and gather data. So that's, you know, that's what we try and do.

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0:43:22 Clip: What I hear when I'm being yelled at is people caring loudly at me.

0:43:27 Thomas: All right, we got some time at the end here for some listener feedback stuff. Always good. Oh, I haven't been able, haven't to play, play the um Parks and Rec quote in a while. I love that one, so I'm, I'm glad I got to play that.

0:43:37 Andrew: We heard from a bunch of folks. First comes from a Liz Dye, who, yeah.

0:43:42 Thomas: Listener Liz D. Yeah.

0:43:46 Andrew: Listener Liz D says that special master Raymond Deary isn't paid, but his support staff is. We I think even in the episode that she was on, we were sort of joking about how now that Judge Cannon has dismissed out the proceedings that sure hope that that Judge Deary got paid in advance.

0:44:04 Thomas: You you said that you said you hope he gets paid

0:44:06 Andrew: Yep. 100 percent. I did say that. And she sent me the original case management order, which I have tried to black out from memory with scotch because we spent an hour and a half breaking that down, was when I was at a chateau in the Italian countryside, and uh, literally, we finished that 90 minute recording, and then it came over the wires that Judge Cannon had thrown out the CMO, but she is 100 correct, technically correct, the best kind of correct, uh, that in that original case management order it says, "As a United States district judge in active service, the undersigned," that is Judge Dearie, "will seek no additional compensation for performing the duties of special master in this action.

However, the undersigned, Judge Dearie, also utilized his Eastern District of New York court staff and appointed, it says, the undersign is determined that the efficient administration of my duties requires the assistant of retired Judge the Honorable James Orenstein, a former U.S. magistrate judge for for the Eastern District of New York, who has experience with complex case management, privilege review, warrant procedures and other matters that may arise in the course of my duties. Judge Orenstein has served as an appointed amicus curiae in the FISA court and holds top secret clearance. So Judge Orenstein was compensated at an hourly rate of five hundred dollars an hour. We do not know how

0:44:17 Thomas: Oh. Yeah. Huh not bad

0:45:29 Andrew: Much work.

0:45:29 Thomas: Work if you can get it so

0:45:30 Andrew: Yeah, we do not know how much work was done, right. The fact that he has the top secret clearance was, obviously significant in connection with efforts to segregate. So looks like may still be outstanding bills due to Judge Orenstein and Judge Dearie's staff. But, yeah, this obscure listener was

0:45:54 Thomas: It's just like it's like, yeah, hey, keep on listening to the show, listener Liz Dye, uh, you, you seem to have uh what it takes to make it in this uh law profession. Um, yeah, so that's interesting. So this is just sort of like a thing that judges do, but don't get paid for. They're just like, yeah, I'll take on this extra workload for nothing. It's just part of their judge Lee duties.

0:45:55 Andrew: Correct. Yeah so I have not seen this before, but then again, I have not seen a sitting judge be appointed as a special master before. I will tell you I have had retired judges, uh, appointed

0:46:22 Thomas: Hmm. Yeah. That's kind of what I thought. I just assumed it was. I didn't,

0:46:27 Andrew: Yeah yeah and so, uh, I assume that this is sort trying to, you know, belt and suspenders, make sure that there is not, not even an appearance of impropriety. And I think that's right. Right. Like, if, if you are, because remember, Trump is footing the bill for this. It was, it was his request. And so, you if you aren't taking paychecks from Donald Trump directly and you are a sitting judge in federal court in New York, could that recreate an appearance of impropriety? That's the only thing that comes to mind. There may be a separate section of the judicial canon of ethics that explicitly prevents you from taking money in these cases.

And if there is, sure one of our listeners will tell us about it. The last part of the CMO illustrates the importance of my side comment, which was, "Plaintiff Donald Trump will submit payment in as directed on the invoice. Failure to make timely payment will be deemed a violation of special master's order, subject to sanctions pursuant to Federal Rule of Civil Procedure 53(c)(2). Well, now that that proceeding has been dismissed out for lack of jurisdiction, uh, FRCP 53 no longer applies, and there was no continuing basis to seek sanctions in court.

0:47:01 Thomas: Hmm.

0:47:47 Andrew: And so direct to hold Trump accountable for paying those bills. But I'm sure, you know, he will pay just them because he's actually incurred them. That seems completely consistent with his longstanding history of not paying bills.

0:48:00 Thomas: Yeah. We didn't even talk about the headlines in the last, sorry, this is going back to the last segment, but I, the headlines that Elon Musk is like, hey, he's got a new business plan, it's just not paying stuff. What, what he's like, we're, they're not gonna pay rent on their building, first off, that's got to be pennies on the dollar of what they're, you know, that's so weird

0:48:22 Andrew: Everything I mean, going back, to to that segment, and it's fine, um, everything Elon Musk has said and done since acquiring Twitter has been inexplicable, right, the, oh, yeah, we're gonna, we're gonna charge eight dollars a month for, uh, you know, ver, for verification, even it, right, like, when you acquire Twitter, particularly when you acquired for 44 billion dollars, the, you know, you can say, "I have a long-term goal of diversifying my revenue streams," but the action of letting Nazis back on that directly tanks your major revenue stream of advertisers so outweighs all of the, like, idiotic tinkering at the margin that Musk

0:48:23 Thomas: Yeah yeah weird, anyway

0:49:05 Andrew: Is trying to do, it's just mind-boggling.

0:49:06 Thomas: Sorry to pull you back in I just forgot about that headline I saw, and I'm sure people are curious, um, weird, but it feels like, when it's something like, this, one thing, if, if you are Trump and you stiff every single contractor you've ever employed, but it feels like if you owe a retired judge and the judge's staff some money related to a legal thingamajig, it feels like the state would make you pay that somehow.

0:49:08 Andrew: Yep, yep. Very, very weird.

0:49:31 Andrew: Yeah, it certainly does feel that way.

0:49:34 Thomas: Is that not true? What? Okay.

0:49:36 Andrew: So, look, you could, here's what could happen is if Trump stiffs Judge Orenstein, Judge Orenstein could file a lawsuit in the state of Florida, right, you know, a collections lawsuit, and, you proceed to a judgment against Donald Trump. But there's no existing enforcement mechanism right now if indeed he has been so stiffed. And again, we don't know. We haven't seen. Those invoices were mailed monthly to the parties, but not filed on the docket. So who Maybe they They have all been paid in full, and this is just pointless speculation.

0:49:36 Thomas: Yeah.

0:50:15 Thomas: Promptly. Sure. All right. On to the next listener feedback here.

0:50:20 Andrew: This comes from a patron, two votes for a live show in Austin, and at least one other listener. And here's what two votes from a live two show and Austin says, says, "Hey, I've been a longtime listener. I love the work you do. I listened to OA 658 and paused at the part where you riff on Mike Lindell being a former quote crackhead. Isn't there enough stigma against addiction, mental health, and recovery without making fun of it? There's so many other reasons to call Mike Lindel an idiot, why focus on this one?" And then goes on into some personal details that I'm not going to, and you're 100% correct and agree with that. We have talked about supporting folks who engage and who are able to recover from addiction. We've also spoken about the Ban the Box initiative and stigma the that folks face in the criminal justice system.

0:51:08 Andrew: Obviously, none of that is relevant to Mike Lindell, um, there are lots and lots of reasons to to make fun of him, and, and a prior history of addiction, uh, shouldn't be among those. And

0:51:17 Thomas: Sorry about that joke. I, definitely, I hear you. I don't think that the point at all would have been to make fun of an addict. I do think that there's... something about, you Mike Lindell, and there's a quality to people who, you might be abusing substances at the time that, I don't know, feels like it's fair game to point out to me. I would certainly never intend it to be a joke on someone having had an addiction, though. And if it, if it came across like that, then, uh, absolutely, sorry about that. Apologies for the clumsy joke. For

0:51:44 Andrew: Our listeners, know, know where our heart is on this. And want to end with this one because this this just warmed my heart, our Monster Cable episode prompted a comment from Kurt Denke, the author of the letter that we read at some length, yeah.

0:51:59 Thomas: All right. Shit. Shit, I hope he didn't turn his ire toward us.

0:52:05 Andrew: Yeah, no.

0:52:05 Thomas: We've seen what he can do with the pen.

0:52:06 Andrew: Yeah. Right. Yeah, yeah, I, I opened it with some trepidation because I was like, "Oh, man, hope this isn't to cease and desist."

0:52:15 Thomas: Opening arguments. Please clarify the connectors that you... Oh, shit.

0:52:20 Andrew: No, Kurt says, "I enjoyed your presentation on this subject. Wanted to let you know that, uh, you are correct in inferring that Monster Cable never responded, not one bloody word. While the details are somewhat hush-hush, I can say that Monster did attempt, unsuccessfully, to bully one of our suppliers into cutting us off." So, wow. Another sort of funny invisible side fact is that Monster apparently sent the same letter to Monoprice, who were using the same connector that was on these Tartan assemblies. And then I'm not going to reveal, you know, how Monoprice responded. But then says, Monster has fallen off the map. I hadn't heard they were down to 10 employees, but that sounds plausible. Last time I was at CES, Monster, which used to have an enormous, elaborate booth, was sharing a much smaller booth with five other brands. Barbasol, Energizer, Venus, that is the women's razors, Armor All, and something else I can't recall off the top of my head. All I know is that when you share a booth with Barbasol at CES, something bad has happened.

0:52:37 Thomas: Oh, wow. Yeah, what even are they doing there? What is this conference now or whatever?

0:53:22 Andrew: I have no, because I can understand. It's the Consumer Electronics Show, so I can understanding razors, but it did, and shaving cream.

0:53:27 Thomas: Yeah, I know. What is that turned into? Razors and... All right. Yeah, how the mighty have fallen. I don't know. Yeah.

0:53:33 Andrew: Yeah, right. That's the point. So Kurt notes, We still manufacture wire and cable products here in Seattle in our 8,000 square foot warehouse, house so maybe Kurt will show up to our inevitable Seattle live show. The Tartan Cable brand products, which were the focus of that dispute, are now gone, a bit of a failed experiment in competing with large importers of inexpensive cable products. When my wife and I started cutting and terminating video coax on the dining room table in 2002 as a part-time business, we never would have imagined that Monster could fall apart so completely, or that we'd have a lively little manufacturing business with a dozen employees. It's a strange world. There's a bit more about his law practice in which he said these people would have probably filed in some highly inconvenient forum, and it would have been an immense hassle. But I can't help but wonder what would have happened if they, that is Monster,

0:53:38 Thomas: Yeah, love

0:54:25 Andrew: Had been dumb enough to file a lawsuit against us. So, Kurt, thank you so much. Episode I'm and a little bit more more behind-the-scenes back there from what's going on with Monster Cable and Blue Jean Cable.

0:54:40 Thomas: It. And we enjoyed the hell out of your response to Mr. Gable. So, yeah, Good stuff. Thanks for contacting us. And that's our show, Andrew. What a fun episode. So many updates, so many rapid response-y things, things, uh, and uh, of course we will next be with you on Sunday night late or talking about some Alex Jones stuff and, you know, asking bar questions. So join us then, again, join us for the Q&A on YouTube, like, very soon, as, as we speak, that's Friday, likely today, the 16th, 4 p.m. Pacific, 7, 7 p.m. Eastern. Be there or be square. And we'll see you then.

0:54:44 Andrew: Indeed.

0:55:15 Clip: I move for a bad court thingy. You mean a mistrial? Yeah, that's why you're the judge and I'm the law talking guy.

0:55:49 Clip: www.openargs.com. Be sure to join the Facebook group at facebook.com slash groups slash Yodel Mountain and follow us on Twitter at OpenArgs. This podcast is a production of Opening Arguments Media LLC, all rights reserved. It is produced with the assistance of transcriptionist Heather Leverage, production assistant Ashley Smith, and additional contributions from Morgan Stringer and Debra Smith. Special thanks to Teresa Gomez, who runs our live shows and heads up the OA Wiki, follow at OA Wiki on Twitter. Additional thanks to the moderators of the Opening Arguments Facebook community, Emily Waters, Alicia Cook, Eric Brewer, Natalie Newell, Brian Ziegenhagen, and Teresa. And finally, thanks to Thomas Smith, who edits the show and created the fabulous theme music, which was used with permission.