Teflon Musk Wins Again With Escape From Defamation Firestorm

(Bloomberg) -- Even before the verdict came in Friday, Elon Musk had earned the sobriquet Teflon Man on Twitter.

Once a jury decided that he hadn’t defamed a British man by calling him a “pedo guy” in a post on the social media platform -- Musk’s favorite -- his reputation as a controversy-stirring billionaire who escapes relatively unscathed from the firestorms he creates for himself seemed to be sealed.

Dan Ives, a Wedbush Securities analyst who covers Tesla Inc., one of Musk’s companies, repeated it: “Right now he’s the Teflon man.” But, Ives added, “it’s a cautionary tale and hopefully situations like this don’t repeat.”

There have been more than a few of those already for Musk, who is chief executive officer of Tesla and chairman and CEO of SpaceX. His boards have tolerated them, his fans love him all the more for his antics and investors don’t seem to mind. Tesla shares have rallied more than 60% in the past six months.

The defamation lawsuit “was the last formal distraction from when Elon Musk went off the Twitter rails in 2018,” said Gene Munster of Loup Ventures.

Even with the positive outcome for Musk, it remains a highly unusual case for a CEO.

In July 2018, as the world was riveted by efforts to save a Thai youth soccer team stuck in a flooded cave, Musk’s engineers tried to help by making a mini submarine out of rocket parts. Vernon Unsworth, an expert caver instrumental in the rescue, told CNN that the mini-sub was little more than a publicity stunt. Musk fired off the “pedo guy” tweet -- and hired a private investigator to dig into Unsworth’s personal life and leak information to British tabloids.

From there, Musk seemed to lurch from crisis to crisis -- and emerged each time with relatively mild consequences. Another Twitter post in August 2018 got him into hot water with the Securities and Exchange Commission; the agency sued him for securities fraud because he said he was taking Tesla private at $420 a share and had “funding secured,” which he in fact did not. (Tesla is still a public company, by the way.)

His settlement with the SEC cost him $20 million and stripped him of his board chairmanship for three years, but he kept running the company as before anyway.

Then there was the famous pot-smoking episode on Joe Rogan’s popular podcast in September 2018. Photos of Musk puffing on a cigar-sized joint went viral in a case of unfortunate optics for SpaceX, which has a contract with NASA to fly astronauts to the International Space Station. Musk later acknowledged in an email to SpaceX employee that the stunt was “not wise.”

Musk was back in the SEC’s sights this February with a Twitter post about Tesla production figures that the agency contended violated the settlement agreement. A judge declined the SEC’s request to hold Musk in contempt and told both sides to “put on your reasonableness pants” and work something out. They did, amending the original deal to include specific topics that Musk can’t tweet about without prior approval from a Tesla lawyer.

On the highly active Twitterverse of Tesla watchers, Friday’s outcome brought a mix of condemnation and applause -- as well as marveling that Teflon Musk had struck again.

Lin Wood, Unsworth’s attorney, had his own take: “Goliath wins almost every time.”

To contact the reporter on this story: Dana Hull in San Francisco at dhull12@bloomberg.net

To contact the editors responsible for this story: Craig Trudell at ctrudell1@bloomberg.net, Anne Reifenberg, Kara Wetzel

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