Elon Musk reportedly threatened to give JPMorgan a 'one star review on Yelp' if it doesn't withdraw its lawsuit
- An ongoing legal dispute between
JPMorganand Teslaled Elon Muskto fire back at the bank in a recent WSJ article.
- "If JPM doesn't withdraw their lawsuit, I will give them a one star review on Yelp," Musk said.
- JPMorgan says Tesla owes the bank $162 million from a warrant trade dating back to 2014.
"If JPM doesn't withdraw their lawsuit, I will give them a one star review on Yelp. This is my final warning!" Musk told The Wall Street Journal. On Twitter, Musk also said regarding the matter, "serious allegations deserve serious responses," and "I will talk to their [JPMorgan's] manager!"
The dispute revolves around Tesla warrants JPMorgan received in 2014 for helping the EV maker set up a trade. The warrants, which were incredibly profitable given Tesla's recent ascent to a $1 trillion valuation, gave the bank the right to buy shares of Tesla at a pre-determined strike price.
According to the contract related to the warrants, JPMorgan had the right to change the strike price if Tesla announced it was exploring a sale, as that would impact the value of the warrants. JPMorgan went ahead and lowered the strike price of its warrants in 2018 after Musk tweeted "funding secured" at $420 per share, according to the lawsuit.
Once the deal announced by Musk didn't materialize, JPMorgan raised its strike price higher, but not all the way back to the original strike price. When the warrants expired in June of this year, Tesla paid JPMorgan based on the original strike price rather than the adjusted strike price made by the bank.
Tesla would owe JPMorgan an additional $162 million if it paid the bank based on the adjusted strike price.
The strike price changes were "unreasonably swift" and "opportunistic," Tesla said in the lawsuit, adding that it was the only bank to make such an adjustment. JPMorgan responded that other banks might have declined to adjust their warrant strike prices "for business reasons having nothing to do with the contractual terms."
JPMorgan's relationship with Tesla seems to have always been on edge. While the bank helped the company go public in 2010, it was ranked behind other banks like Goldman Sachs and Morgan Stanley. Tesla has paid JPMorgan about $15 million for advice and capital
And JPMorgan's consumer bank was initially hesitant to
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