In one of the lawsuits, the plaintiff Kalman Isaacs said Musk's tweets were false and misleading, and together with Tesla's failure to correct them amounted to a "nuclear attack" created to "completely decimate" short-sellers. Tesla's shares briefly turned negative on the news and traded up 0.8 per cent at 4:05 p.m.in NY.
The lawsuits were filed three days after Musk stunned investors by announcing on Twitter that he might take Tesla private in a record $72 billion (roughly Rs. 4.97 lakh crores) transaction that valued the company at $420 (around Rs. 29,000) per share, and that "funding" had been "secured". People close to at least 16 financial institutions and technology firms, who spoke on the condition of anonymity, have said they weren't aware of financing having been locked in before Musk's tweet.
No evidence has been presented by either side to prove or disprove that funding had been secured to take the company private.
The board of directors was informed of Musk's idea to turn Tesla into a privately-held company at least a week before he tweeted about it, six of the nine board members confirmed in a brief statement.
Tesla is holding early discussions with banks about the feasibility and structure of a possible deal to take the company private, sources said. "My hope is for all shareholders to remain", Musk said.
"Short shorts coming soon to Tesla merch", Musk tweeted. If a deal involves debt financing, those providing funding could expect fees of about US$500 million.
Tesla is facing a make-or-break moment in its eight-year history as a public company, as competition from European automakers is poised to intensify with new electric vehicles from Mercedes, Audi, BMW and other rivals.
The stock has since retreated, in part following reports that the U.S. Securities and Exchange Commission had begun inquiring about Musk's activity.