JPMorgan Chase has agreed to drop its lawsuit against Tesla, which accused the electric vehicle manufacturer of breaching a 2014 contract related to stock warrants sold to the bank. Both companies announced the decision in a court filing in Manhattan, stating they would withdraw claims against each other. The terms of the settlement remain undisclosed.
JPMorgan initially filed the lawsuit in November 2021, seeking $162.2 million in damages, claiming Tesla violated the contract by not adjusting the warrant prices following a tweet by Tesla CEO Elon Musk in 2018. Musk's tweet suggested taking Tesla private at $420 per share, causing stock price volatility. JPMorgan adjusted the exercise price of the warrants in response to maintain fair market value, but claimed Tesla did not fulfill its financial obligations.
Tesla countersued in January 2023, accusing JPMorgan of seeking excessive profits in the warrant repricing process. The companies have now resolved their disputes and plan to establish a new business relationship.
