Tesla Enters “Whistleblower Hell”

https://www.thedrive.com/tech/29089/tesla-enters-whistleblower-hell

by AndrewBissell • 7 years ago

129 124 7 years ago

xrd• 7 years ago

"Pablo Escobar’s brother recently demanded $100 million in cash or Tesla shares from Musk for purportedly stealing his flamethrower idea, but the Escobars are Colombian."

(Edit: sorry, didn't see the first part where it is stated that the lawsuit includes Mexican nationals. But, I still think it's crazy that this is included in an article about Tesla and whistleblowers)

PhantomGremlin• 7 years ago

It's not clear from your one word comment exactly what you're "whatting" about. Perhaps it's the silliness of the demand. Perhaps it's the "Colombian" thing at the end?

If it's the Colombian bit, what you didn't quote makes clear what's happening. The lawsuit alleges links to a Mexican drug cartel. The Colombian comment at the end was to make clear that the Escobars are (allegedly) part of a different drug cartel.

Here's the full paragraph:

Paragraphs 16 through 19 of the lawsuit identify thefts ranging between $37 and $150 million dollars, along with links to a Mexican drug cartel. (Pablo Escobar’s brother recently demanded $100 million in cash or Tesla shares from Musk for purportedly stealing his flamethrower idea, but the Escobars are Colombian.)

lovemenot• 7 years ago

I have no perspective on the merits of these claims, but the approach smells a bit off.

1. Make a name as a whistleblower

2. Invite further insiders to volunteer new negative stories

3. Solicit "the right people" to fund your operation

The concern here is insider trading. It's implied that funding contributors (Tesla shorts) may receive preferential access to negative news stories.

Edit: insider trading is not the correct legal term. Extortion perhaps? Which law would prevent them from just coming out and saying "fund us and get the scoop on bad news for Tesla"?

vikramkr2• 7 years ago

Tesla (or at least Elon) has a terrible habit of engaging with critics in deeply unproductive ways, such as all the anti short seller stuff they pulled. It makes them look very defensive and seem like they feel vulnerable/cant face the criticism, and maybe it's because they actually are vulnerable and doing things that merit short selling and whistleblowing.

At least from a PR perspective you dont want to engage like this if you have nothing to hide, so either they're doing something wrong or they have terrible terrible PR sense. Both seem equally likely right now.

drcross• 7 years ago

Short sellers have been causing the company a lot of trouble, Musk is correct in pointing them out so that their activities become known.

vikramkr2• 7 years ago

No, they really haven't. The best way to deal with shorts is to have a good quarter and crush them all. Or wait for a short squeeze. Lots of companies have misinformation spread by shorts all the time, but very few companies engage and attack shorts.

twblalock• 7 years ago

There is nothing wrong with shorting Tesla. Short selling is a necessary corrective to overhyped stocks.

If the short sellers are wrong about Tesla being overpriced, they will pay for it. They are taking all of the risk, and they are not hurting anything except Musk's feelings.

true_tuna2• 7 years ago

Deliberately manipulating his stock price to damage short sellers is profoundly unprofessional behavior though. And apparently just a little bit illegal.

ghostly_s• 7 years ago

If you have any examples of companies who weren't doing something unsavory and had a recurrent problem with whistleblowers I'd love to hear them.

ryandrake• 7 years ago

Well, whistleblowing, by definition, requires the target to be doing unsavory things. Otherwise, it's just "leaking" and many companies have ongoing problems with things like product plans being leaked.

tylerl• 7 years ago

Whistleblowing by definition means reporting something that (someone thinks) is unsavory. You can argue whether a given set of whistleblowers are misguided, but otherwise you don't call them whistleblowers.

unityByFreedom9• 7 years ago

No need to rush to judgement, this will be an interesting case to follow,

“It’s taken a long time to get to this point, and I remain steadfast regardless of any monetary outcome. The only thing we are guaranteed to take to our graves is our name. I’ve spent a career of integrity, and won’t stand idly by when someone like Elon Musk runs roughshod over others because he happens to be a billionaire.”

edit Please give me the courtesy of explaining downvotes. Thanks.

gamblor9564• 7 years ago

Since you made both a condition, 99% of large corporations.

If you meant either/or, Patagonia. Clifs. Panera. In n out. There's way more but hopefully you get the point.

smallgovt2• 7 years ago

At least from a PR perspective you don't want to engage like this if you have nothing to hide.

Responding in public fashion is a rational choice for TSLA to make assuming:

1) There exist short sellers who are willing to engage in malicious activities that hurt shareholder value

2) Publicizing their efforts to fight back against said actors acts as a deterrent for further malicious activity.

I don't know for sure, but I think there's a reasonable likelihood that both these statements are true.

Lazare2• 7 years ago

I find both extremely implausible, both individually and (especially) in combination.

finnthehuman• 7 years ago

Dude. You gotta let it go. These are pretty unsurprising allegations for a company like Tesla. And short sellers are not the boogieman, they're just an indication that the value of Tesla is highly uncertain.

unityByFreedom9• 7 years ago

Someone motivated to short-sell might be further motivated to state their case publicly. What's wrong with that?

Short selling is part of a functioning market. It's not some evil thing. It's one mechanism the financial world uses to gauge company value. I'm shocked every time I read this conspiracy theory on HN. The positions of these traders are public.

The only response to short sellers is to focus on your business. Responding with "it's a conspiracy" does not help your business.

wnorris• 7 years ago

There appears to be an active group working to create these stories in order to create a 'whistleblower hell'.

Elon occasionally does not help this, but authorities should look into the allegations that a group is actively manipulating Tesla employees for these types of stories.

https://cleantechnica.com/2019/07/21/were-cnbc-sources-tesla...

kreetx7• 7 years ago

Elon gets a lot of hate unfortunately due to his position in the industry, and also I guess the age we're in.

See this tweet from Paul Graham for example https://twitter.com/paulg/status/1122987659079618563

People notice the hate, and although there most probably are issues in the factories, then the reporting of them is way bent to the negative.

unityByFreedom9• 7 years ago

That's not an objective source.

Clean Technica is to Elon Musk as Fox News is to Donald Trump

shiftpgdn• 7 years ago

620 lawsuits over about 10 years seems remarkably small for a company the size of Tesla. Is there an attorney who can shed light on how many lawsuits a company with a 50 billion market cap would normally receive?

Anecdotally: I worked for a company with a sub hundred million dollar market cap and they had /thousands/ of open lawsuits every year.

Waterluvian• 7 years ago

What industry was the company in?

gamblor9564• 7 years ago

I work for a company right in the 100 million range and they've only been sued 3 times in their entire history.

It's not common for companies to get sued. 620 over Tesla's lifespan is extreme.

Lendal• 7 years ago

I never see stories about Ford's current lawsuits, or GM or Chrysler. I'm curious what goes on behind the scenes to get stories like these published and pushed out onto social media sites across the globe. Must be a pretty expansive operation because I see it every week, same stuff week in and week out. Is it true that other companies don't have disgruntled employees? I find that difficult to believe.

camjohnson263• 7 years ago

If Pablo Escobar’s brother ever threatens Ford with a lawsuit over flamethrowers I guarantee it’ll make the news. Tesla gets more coverage because Tesla has a more dramatic story.

GuiA• 7 years ago

The CEOs of those companies aren’t committing securities fraud or insulting random people on Twitter, for starters.

rcMgD2BwE72F3• 7 years ago

aren’t committing securities fraud

Please elaborate.

grecy• 7 years ago

There are trillions of dollars at stake in the auto industry that Tesla is trying to seriously disrupt.

There are trillions of dollars at stake in the launch industry that SpaceX is trying to seriously disrupt.

There are trillions of dollars at stake in the ride-share/taxi industry that Tesla/Elon is trying seriously to disrupt.

There are a lot of people who are working very hard to paint a very negative picture of Elon/Tesla/SpaceX right now.

It's amazing that stories like this make headlines while the news that the Tesla Model 3 is outselling every other electric vehicle combined doesn't make a blip.

Follow the money.

MegaButts• 7 years ago

Follow the money

And yet if you do this at the actual companies (SpaceX, Tesla) or industries (rideshare) you mention, most traditional economists will tell you they have questionable futures based on their balance sheets (all of them have been consistently losing extremely large amounts of money for years) and some believe they will actually go to zero. So by following the money, it's not hard to see why some would think these companies are overvalued.

joshuamorton• 7 years ago

Over what timescale?

United Launch Alliance, SpaceX's main (only?) competitor pulls in a few billion in revenue a year. Profits are well under $100 million, so we're talking Trillions over a couple thousand years. Arguably, if we're disrupted into a spacefaring species, this could change, but there's physical problems with that.

You might be correct about rideshare/taxi industries over a 100 year timespan or something, but not before Elon dies.

So that leaves car industries. Which are the closest, but EVs aren't going to take over any time soon, and other carmakers are better at logistics than Tesla, and that's the important part.

imfromit• 7 years ago

Can someone explain to me (a simple European scrub) why these sorts of lawsuits seem to invariably target Elon directly? Surely they should be directed at Tesla, you know the company that employed them? Does adding Elons name to the lawsuit actually do anything in US law? Or is it merely to gain publicity by adding celebrity to a complaint?

stonogo• 7 years ago

The Sarbanes-Oxley act requires corporate leadership to take personal responsibility for the accuracy of certain company-generated reports. This lawsuit is against both Musk himself and Tesla the company.

choppaface• 7 years ago

In at least one instance, there's evidence that Musk personally instigated an effort to use a Nevada Sheriff to retaliate against a whistleblower: https://news.ycombinator.com/item?id=19378658

_bxg1• 7 years ago

These claims reek of personal vindictiveness, not corporate strategy. I honestly don't find it hard to believe that Elon has allowed his savior complex to become pathological, or that - like Zuckerberg and Kalanick - he's personally responsible for his company's most problematic behavior.

Tistel• 7 years ago

I have not been in a Tesla with Full Self Drive (FSD) and I was hoping someone here can confirm/deny my theory. The theory is that there will be this dangerous trough with the FSD feature. So at the no FSD end of the speactrum the driver is engaged mentally trying to safely get to were they want to go. At the other end of the spectrum, with fully working FSD that is better than people can drive you are are by definition safer. But! In the middle you have this dangerous middle ground. Its dangerous because the car is doing say 85% of the work, but, you need to be eagle eyed to grab the wheel and/or hit the brakes when the FSD falls into the 15% not working part. The fact that the car is doing most of the work is going to lead to people being bored and spacing out and not being ready to hit the brakes. For example: https://www.youtube.com/watch?v=Ki9RK_JDtIg. To anyone who has spent time in a FSD car, is that the case? Or is it sufficiently fear inducing that you pay super attention?

pmorais• 7 years ago

Disappointing that the majority of the comments here are conspiracy theories about nefarious short-sellers somehow influencing coverage (including this article) and not a single person is discussing the seriously damning allegations of 1) millions of dollars of embezzlement 2) connections to organized crime and Mexican drug cartels 3) systematic firing of those who report impropriety to upper management and 4) using law enforcement to intimidate whistleblowers

Seriously this comment section of conspiratorial Tesla apologists is pathetic.

unityByFreedom9• 7 years ago

I feel the same way. If I could find another tech forum where I could find topics like this and discuss them without hearing from anti-media conspiracy theorists I would join it in a heartbeat.

Even just a view of HN comments without having to weed out the threads complaining about fake news would be great. I bet it's not so hard to train a classifier to identify comments that amount to "This article is paid for by short sellers". They all make the same point and never address the issues in the article.

rcMgD2BwE72F3• 7 years ago

discussing the seriously damning allegations

Oh please, provide some reliable sources.

So far, all the allegations -- including the ones pushed by the NYT about the company hiding unsold Model 3 inventory in the desert to cover lack of demand -- proved to be nothing.

P_I_Staker5• 7 years ago

There's plenty of debunkers here as well.

Tesla Enters “Whistleblower Hell”

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