Tag Archives: business figures

FTX founder Sam Bankman-Fried arrives in court to face charges


New York
CNN
 — 

Sam Bankman-Fried, the disgraced founder of bankrupt crypto exchange FTX, has arrived at a Manhattan federal court where he is set to appear to face charges that include cheating investors out of billions of dollars.

Authorities have accused Bankman-Fried of stealing customer funds from FTX to cover loans taken out by Alameda Research, FTX’s affiliated crypto hedge fund. They also say he used those funds to make investments in other companies and donate to campaigns of politicians from both parties to influence public policy.

In public statements following FTX’s collapse in November, Bankman-Fried has insisted that he didn’t commit fraud and was unaware that customer funds were being used improperly.

He is expected to plead not guilty Tuesday.

Two senior executives from Bankman-Fried’s crypto businesses — Gary Wang, the co-founder of FTX, and Caroline Ellison, who served as Alameda’s CEO — have pleaded guilty to multiple criminal charges and are cooperating with federal prosecutors.

Ellison apologized while entering her plea last month, telling the court that she “agreed with Mr. Bankman-Fried and others to not publicly disclose the true nature of the relationship between Alameda and FTX, including Alameda’s credit arrangement.”

As part of his release, Bankman-Fried is under house arrest at his parents’ home in Palot Alto, California. He is wearing a monitoring device and has surrendered his passport.

He could face up to 115 years in prison if convicted on all charges.

Last month, a US judge released him on a $250 million bond in his first appearance on American soil since his arrest in the Bahamas, where he lived and ran his businesses.

Bankman-Fried’s parents, both law professors at Stanford who co-signed his bond, have “become the target of intense media scrutiny, harassment, and threats,” defense lawyers wrote in a letter to the court, while asking to redact the names of two other co-signers, known as “sureties.”

“There is serious cause for concern that the two additional sureties would face similar intrusions on their privacy as well as threats and harassment if their names appear unredacted on their bonds or their identities are otherwise publicly disclosed,” the letter states.

Prosecutors allege that Bankman-Fried orchestrated “one of the biggest financial frauds in American history,” stealing billions of dollars from FTX customers to cover losses at its sister hedge fund, Alameda Research.

FTX and Alameda both filed for bankruptcy in December after investors rushed to pull their deposits from the exchange, sparking a liquidity crisis and triggering contagion across the crypto industry.

FTX’s new CEO, John Ray III, who made his name overseeing the liquidation of Enron in the early 2000s, said in a congressional hearing that customer funds deposited on the FTX site were commingled with funds at Alameda, which made a number of speculative, high-risk bets.

Ray described the situation at the two companies as “old-fashioned embezzlement” at the hands of a small group of “grossly inexperienced and unsophisticated individuals.”

— CNN’s Allison Morrow and Samantha Murphy Kelly contributed to this report.

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Elon Musk has lost a bigger fortune than anyone in history


New York
CNN
 — 

Elon Musk’s wealth destruction has become historic.

The CEO of Tesla

(TSLA), SpaceX and Twitter is worth $137 billion, according to the Bloomberg Billionaires Index, good enough for second place on the list of the world’s richest behind LVMH

(LVMHF) Chairman Bernard Arnault. But at its peak in November 2021, Musk’s net worth was $340 billion.

That makes Musk the first person ever to lose $200 billion in wealth, Bloomberg reported last week.

The bulk of Musk’s wealth is tied up in Tesla

(TSLA), whose stock plunged 65% in 2022. Demand for Tesla

(TSLA)s weakened as competition in electric vehicles from established automakers surged last year. The company missed its growth targets and scaled back production in China.

Evidence of car buyers’ sinking interest in Teslas became apparent last month after the company announced a rare sale in a bid to clear out inventory. Tesla offered two rebates for buyers taking delivery of a vehicle before the end of the year, initially offering a $3,750 discount then doubling the rebate to $7,500 with two weeks left in 2022.

Investors were rattled by the rebates, sending the stock plunging 37% in December.

Critics have long questioned whether Tesla was ever worth the trillion-dollar valuation it had at the start of 2022. At its peak, Tesla was worth more than the 12 largest automakers on the planet combined, despite having a fraction of their sales. Tesla ended the year worth $386 billion — still much larger than its automaker rivals but far smaller than the tech titans — Apple

(AAPL), Microsoft,

(MSFT) Google

(GOOGL) and Amazon

(AMZN) — with which it was being compared a year ago.

Musk’s $44 billion purchase of Twitter hasn’t helped Tesla’s stock or Musk’s personal wealth, either. Musk, Tesla’s largest shareholder, has sold $23 billion worth of Tesla shares since his interest in Twitter became public in April.

His constant tweeting and increasingly erratic behavior, particularly after taking over as CEO at Twitter, has angered Tesla investors who want Musk to pay more attention to his significantly larger and more valuable company. Musk has defended himself against critics, saying he hasn’t missed a major Tesla meeting since taking on responsibility for Twitter.

Tesla’s stock may rebound, and Musk could once again become the world’s richest person. But Musk’s reputation as a genius took some serious damage in 2022 — almost as much damage as his personal wealth.

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Tesla shares are down 70% for the year


New York
CNN
 — 

Tesla’s stock is finishing out its tumultuous year with yet more turbulence: It’s up almost 6% Thursday, but still down more than 10% since last week. And a new cut to its price target from Morgan Stanley isn’t helping.

Year-to-date, the stock is down about 70%. Morgan Stanley analysts on Thursday said that the company’s sliding stock price represents a buying opportunity, but they cut its price target from $330 per share to $250. Tesla shares are trading at $122, with the stock up about 8% Thursday.

Morgan Stanley still believes the company is somewhat undervalued as a result of the big recent sell-offs, citing its head start over the electric car competition, and potential tax advantages as a result of the Inflation Reduction Act passed earlier this year.

The losses, however, have further put a dent in the fortunes of one of the world’s richest people. According to the Bloomberg Billionaires Index, CEO Elon Musk is now worth $132 billion — less than half what he was worth at the beginning of the year. He lost the world’s richest person title two weeks ago to Bernard Arnault, the chairman of French luxury goods giant LVMH

(LVMHF).

A popular misconception has emerged about Elon Musk and Tesla: The megabillionaire’s love affair with Twitter is the main reason Tesla shares have lost so much value this year.

Even as Musk signals he may give up his CEO title at Twitter, investors became concerned that the outlook for Tesla’s sales and profit is taking a turn for the worse. A sign of the weakening demand: Tesla has announced a rare sale. The company offered two rebates for buyers who take delivery of a vehicle before the end of the year, initially offering a $3,750 discount earlier this month. Tesla then doubled that rebate to $7,500 last Thursday.

“Tesla clearly is starting to see demand cracks in China and in the US at a time that EV competition is increasing across the board,” said Dan Ives, tech analyst with Wedbush Securities and a Tesla bull who cut his price target for the stock last Friday from $250 to $175. “The price cuts that Tesla enacted was the straw that broke the camel’s back on the stock.”

Another reason Tesla’s stock is sinking: The US economy could tip into recession next year, hurting car sales. Musk said on a Twitter Spaces call two weeks ago that he foresees the economy will be in a “serious recession” in 2023.

“I think there is going to be some macro drama that’s higher than people currently think,” he said, according to Reuters, adding that homes and cars will get “disproportionately impacted” by economic conditions.

Part of the problem with Tesla’s stock price is that critics question whether it was ever worth the trillion-dollar valuation it had at the start of the year. At its peak, Tesla was worth more than the 12 largest automakers on the planet combined, despite having a fraction of the sales of any of them. Today it is worth $399 billion.

“It got ahead of itself in the near-term,” said Gene Munster of Loup Ventures, another Tesla fan. “I still believe this can be a much bigger company. I think it will see those kinds of numbers again. But it could take a long, long time to get there.”

Tesla’s growth prospects – a target of 50% sales growth annually, helped drive that valuation. It conceded in October that it will miss that sales target for this year.

The stock’s climb to dizzying heights – rising 743% in 2020 alone – was driven by Musk’s reputation as a genius who would disrupt the massive global auto industry.

“Tesla was viewed as a disruptive technology company, not as an automaker, and a large part of that premium is related to Musk,” said Ives.

Critics of Tesla said much of its sky-high valuation was based on promises that Musk made about future products, many of which came years after they were originally promised.

A prime example is the Cybertruck, the Tesla pickup truck, first unveiled three years ago with promises that production would start in 2021.

Now production is slated to start next year, with a ramp-up in production in 2024, putting it years behind other electric pickup offerings from Ford and upstart EV maker Rivian, both of which have electric pickups available for purchase today. It could also trail planned electric pickup offerings from General Motors.

“Elon Musk has a pathological problem with the truth,” said Gordon Johnson, one of the largest critics of Tesla among analysts. “When people say he’s a genius and innovator, it’s based on all his promises he never lives up to.”

Johnson said Tesla shares will have a much steeper fall ahead, once it starts being priced like other automakers rather than on its promises. He said that for Tesla to hit its growth targets it needs to be building new plants almost every year, but that new factories in Germany and Texas that opened in spring are still not operating at full capacity. And he said that its plant in China has had to scale back production due to weak sales in the market in the face of the Covid restrictions.

“Demand in the US has collapsed,” he said. “Two months ago, your wait time was two or three months. Now you can get one immediately. They’re going to build more cars than they sell for a third straight quarter. It’s the definition of excess capacity.”

Tesla is still by far the largest EV maker worldwide, although that title is being challenged in some key markets, by Volkswagen in Europe and by BYD in China. And more competition is coming from established automakers such as Ford and GM.

That’s not to say Twitter has played no role in Tesla’s stock price demise this year: Tesla shares have lost over 65% of their value since Musk’s interest in Twitter was first disclosed in April, with a nearly 50% decline since he closed on the deal in late October.

Investors have been disappointed that Musk appears to be paying for so much of his $44 billion purchase of Twitter by selling Tesla stock. Musk, Tesla’s largest shareholder, has sold $23 billion worth of Tesla shares since his interest in Twitter became public in April.

On a Twitter Spaces call last week call, Musk promised he was done selling shares of Tesla

(TSLA) stock until at least 2024, if not beyond. But he hasn’t lived up to a previous promise in April that he was done selling Tesla

(TSLA) shares, selling $14.4 billion of that stock since that time.

“It’s been a Pinocchio situation for Musk saying he is done selling stock. Investors want to see him walk the walk and not just talk the talk,” said Ives.

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Business partners turn on Sam Bankman-Fried


New York
CNN
 — 

The stunning collapse of one of crypto’s most prominent firms has quickly morphed into a legal battle pitting former executives and ex-romantic partners against one another.

Last week, as FTX founder Sam Bankman-Fried was being extradited to the United States from the Bahamas, two of his former business partners pleaded guilty to multiple charges of fraud and conspiracy.

Caroline Ellison, the 28-year-old former CEO of the crypto hedge fund Alameda, apologized before a federal judge in New York, saying that she and her former associates knowingly stole billions of dollars from customers of Bankman-Fried’s FTX exchange and sought to cover it up, according to court transcripts.

“I am truly sorry for what I did,” Ellison told the court. “I knew that it was wrong.”

Ellison told the court that Alameda had a virtually unlimited borrowing facility in FTX, and that she knew the exchange would need to use customer funds to finance loans to the hedge fund. She also agreed to keep the two firms’ unusually close relationship hidden from investors and customers.

From July through October, she told the court, Ellison agreed with Bankman-Fried and others to provide “materially misleading financial statements to Alameda’s lenders,” and prepared balance sheets that concealed the extent of Alameda’s borrowing.

Ellison has been charged with seven criminal counts, including conspiracy to commit wire fraud and money laundering. She and Bankman-Fried were close business associates who briefly dated.

Another associate, Gary Wang, FTX’s former chief technology officer, pleaded guilty to four counts of similar charges.

Wang told the court that part of his role at FTX included making changes to the exchange’s code that would grant Alameda “special privileges” on FTX.

“I knew what I was doing was wrong,” he said.

Both Ellison and Wang are cooperating with federal prosecutors, making them potentially damning witnesses against Bankman-Fried, who has repeatedly denied intentionally defrauding customers and investors.

Bankman-Fried, 30, appeared Thursday in a US courtroom in New York, where a federal judge released him on a $250 million bond. He is required to surrender his passport and remain under house arrest at his parents’ home in Palo Alto, California.

Although $250 million is an extraordinary sum, Bankman-Fried won’t have to pay it unless he violates the terms of his bail agreement or fails to show up to court. The atypical bail plan was agreed to as part of his commitment to waive his extradition fight.

Following his court appearance, Bankman-Fried was spotted in a business class lounge at New York’s John F. Kennedy International Airport. Crypto reporter Tiffany Fong also tweeted a photo showing Bankman-Fried on an American Airlines flight.

Bankman-Fried’s legal team confirmed to CNN Business that he had arrived in Palo Alto and was home with his parents. His lawyer declined to comment on the guilty pleas by Ellison and Wang.

The federal judge Thursday said Bankman-Fried would be arraigned on eight criminal counts including fraud and conspiracy at an unspecified future date.

Prosecutors allege that Bankman-Fried orchestrated “one of the biggest financial frauds in American history,” stealing billions of dollars from FTX customers to cover losses at Alameda and to enrich himself. If convicted, he could face life in prison.

Bankman-Fried, prior to his arrest in the Bahamas earlier this month, had sought to portray himself as a hapless entrepreneur who got out over his skis. He repeatedly apologized to customers and to FTX staff, saying he “f—ed up,” while denying that he knowingly defrauded anyone.

— CNN’s Lauren del Valle and Kara Scannell contributed reporting.



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Elon Musk’s Twitter obsession isn’t the core reason for Tesla stock’s plunge


New York
CNN
 — 

A popular misconception has emerged about Elon Musk and Tesla: The megabillionaire’s love affair with Twitter is the main reason Tesla shares have lost so much value this year. But Tesla’s steep stock selloff this week proved that the problems at Musk’s car company go well beyond Twitter.

Even as Musk signals he may give up his CEO title at Twitter, investors became concerned that the outlook for Tesla’s sales and profit is taking a turn for the worse. A sign of the weakening demand: Tesla has announced a rare sale. The company offered two rebates for buyers who take delivery of a vehicle before the end of the year, initially offering a $3,750 discount earlier this month. Tesla then doubled that rebate to $7,500 Thursday.

“Tesla clearly is starting to see demand cracks in China and in the US at a time that EV competition is increasing across the board,” said Dan Ives, tech analyst with Wedbush Securities and a Tesla bull who cut his price target for the stock Friday from $250 to $175. “The price cuts that Tesla enacted was the straw that broke the camel’s back on the stock.”

Another reason Tesla’s stock is sinking: The US economy could tip into recession next year, hurting car sales. Musk said on an Twitter Spaces call Thursday he foresees the economy will be in a “serious recession” in 2023.

“I think there is going to be some macro drama that’s higher than people currently think,” he said, according to Reuters, adding that homes and cars will get “disproportionately impacted” by economic conditions.

Part of the problem with Tesla’s stock price is that critics question whether it was ever worth the trillion-dollar valuation it had at the start of the year. At its peak, Tesla was worth more than the 12 largest automakers on the planet combined, despite having a fraction of the sales of any of them. Today it is worth $399 billion.

“It got ahead of itself in the near-term,” said Gene Munster of Loup Ventures, another Tesla fan. “I still believe this can be a much bigger company. I think it will see those kinds of numbers again. But it could take a long, long time to get there.”

Tesla’s growth prospects – a target of 50% sales growth annually, helped drive that valuation. It conceded in October that it will miss that sales target for this year.

The stock’s climb to dizzying heights – rising 743% in 2020 alone – was driven by Musk’s reputation as a genius who would disrupt the massive global auto industry.

“Tesla was viewed as a disruptive technology company, not as an automaker, and a large part of that premium is related to Musk,” said Ives.

Critics of Tesla said much of its sky-high valuation was based on promises that Musk made about future products, many of which came years after they were originally promised.

A prime example is the Cybertruck, the Tesla pickup truck, first unveiled three years ago with promises that production would start in 2021. Now it is slated to start production next year, with a ramp-up in production in 2024, putting it years behind other electric pickup offerings from Ford and upstart EV maker Rivian, both of which have electric pickups available for purchase today. It could also trail planned electric pickup offerings from General Motors.

“Elon Musk has a pathological problem with the truth,” said Gordon Johnson, one of the largest critics of Tesla among analysts. “When people say he’s a genius and innovator, it’s based on all his promises he never lives up to.”

Johnson said Tesla shares will have a much steeper fall ahead, once it starts being priced like other automakers rather than on its promises. He said that for Tesla to hit its growth targets it needs to be building new plants almost every year, but that new factories in Germany and Texas that opened in spring are still not operating at full capacity. And he said that its plant in China has had to scale back production due to weak sales in the market in the face of the Covid restrictions.

“Demand in the US has collapsed,” he said. “Two months ago, your wait time was two or three months. Now you can get one immediately. They’re going to build more cars than they sell for a third straight quarter. It’s the definition of excess capacity.”

Tesla is still by far the largest EV maker worldwide, although that title is being challenged in some key markets, by Volkswagen in Europe and by BYD in China. And more competition is coming from established automakers such as Ford and GM.

That’s not to say Twitter has played no role in Tesla’s stock price demise this year: Tesla shares have lost 66% of their value since Musk’s interest in Twitter was first disclosed in April, with a 45% decline since he closed on the deal in late October.

Investors have been disappointed that Musk appears to be paying for so much of his $44 billion purchase of Twitter by selling Tesla stock. Musk, Tesla’s largest shareholder, has sold $23 billion worth of Tesla shares since his interest in Twitter became public in April.

On Thursday’s Twitter Spaces call, Musk promised he was done selling shares of Tesla stock until at least 2024, if not beyond. But he hasn’t lived up to a previous promise in April that he was done selling Tesla shares, selling $14.4 billion of that stock since that time.

“It’s been a Pinocchio situation for Musk saying he is done selling stock. Investors want to see him walk the walk and not just talk the talk,” said Ives.

Another Twitter factor: Musk named himself CEO of Twitter, the third major company he leads, along with Tesla and SpaceX. So, many people assumed that Musk’s loss of focus on Tesla has spooked its former fans on Wall Street.

But this week began with Musk running a poll – on Twitter of course – asking if he should give up the CEO title at his social media plaything. He promised he would comply with the result, and 57.5% of those who voted said they want him gone.

That departure may take a while – Musk tweeted he will resign “as soon as I find someone foolish enough to take the job!” And the same tweet he cautioned that even if he gives up the CEO title at Twitter, he’s not walking away totally, saying that he plans to “just run the software & servers teams” after finding a new “fool” to be CEO.

The poll results late Sunday were enough to lift Tesla shares in early trading Monday, but the shares ended the day slightly lower, and have lost significantly more ground every day since. Tesla shares fell 9% Thursday, and it ended the week down 18% after another 2% drop on Friday.

And then there’s the question of how much damage the debacle at Twitter has done to the Tesla brand. Musk has fired thousands of employees, banned journalists while allowing Donald Trump and other previously banned accounts back online, called for the prosecution of Dr. Anthony Fauci, embraced conspiracy theories and made anti-trans statements in his short tenure as CEO.

It may have endeared him to some but angered other potential buyers, including liberals who might be willing to pay a premium for a more environmentally friendly vehicle.

“I think it was measurable damage,” said Munster, who believes the publicity over his time at Twitter cost Tesla 5% of its sales.



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Twitter layoffs continue under Elon Musk



CNN
 — 

Additional Twitter employees were terminated Thursday as part of ongoing, rolling layoffs under new owner Elon Musk, including from the public policy and media and entertainment teams, according to tweets from affected employees.

As part of Thursday’s layoffs, the members of Twitter’s public policy team who had remained following last month’s mass layoffs were again cut down by about half to around 15 employees, a former Twitter employee with knowledge of the layoffs told CNN.

Among the public policy team’s responsibilities are working with outside advisory groups such as the Twitter Trust and Safety Council, which the company disbanded earlier this month. It also manages human rights programs to protect vulnerable users like activists, engages in transparency efforts, works with government agencies and helps to ensure compliance with global regulations. The public policy team had more than 60 employees prior to Musk’s takeover, the former employee said.

Thursday’s exits come after Musk laid off about half of Twitter’s workforce last month shortly after his takeover, and later pushed out additional employees, including through an ultimatum requiring them to work “hardcore” or exit the company. Musk’s team — seeking to cut costs at the struggling company that the billionaire purchased for $44 billion — has continued to lay off hundreds of additional Twitter staff since then, including top engineering and legal talent, according to the former employee and multiple recent reports.

More than 100 former Twitter employees have filed demands for arbitration or are participating in proposed class action lawsuits related to the layoffs.

The latest round of layoffs could further affect Twitter’s ability to protect key users and comply with regulations amid heightened scrutiny of the company following Musk’s takeover.

Thierry Breton, a top EU official, warned Musk in a meeting last month that the social media platform must take significant steps to comply with EU content moderation laws, and that European officials will be monitoring closely for compliance. Musk has agreed to let EU officials “stress test” the social media platform for compliance with the Digital Services Act, Europe’s new platform regulation, early next year.

Twitter also continues to struggle with the exit of many of its advertisers, which provide most of the company’s revenue. As of December 17, 72 of Twitter’s top 100 advertisers had paused ad campaigns on the platform, according to a review by digital marketing intelligence firm Pathmatics, which it provided to CNN.

In the meantime, Musk may be considering finding someone else to head the social platform, after Twitter users voted over the weekend for him to step down as CEO. Musk tweeted this week that he would leave the top role “as soon as I find someone foolish enough to take the job!”

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Sam Bankman-Fried seeks bail deal while being extradited to US


New York
CNN
 — 

Lawyers for Sam Bankman-Fried are negotiating with federal prosecutors in New York on a bail arrangement that would enable him to avoid detention, people familiar with the matter told CNN.

FTX crypto exchange founder Bankman-Fried, who oversaw his now-bankrupt crypto empire from a luxury compound in the Bahamas, is expected to return as early as Wednesday to the United States.

In a hearing Wednesday morning, his lawyer in the Bahamas told the court that Bankman-Fried had agreed to extradition to the US, where federal prosecutors have charged him with orchestrating “one of the biggest financial frauds in American history.”

Once the 30-year-old is stateside, Bankman-Fried will appear before a judge in Manhattan for a bail hearing. The timing of that hearing will depend on when he arrives in New York and is processed.

In the week and a half since his arrest in the Bahamas, Bankman-Fried has been held in a prison that US officials have described overcrowded, dirty and lacking medical care. Its crowded cells often lack mattresses and are “infested with rats, maggots, and insects.”

Prosecutors and attorneys for Bankman-Fried are discussing an arrangement for his release, with conditions, that would enable the failed crypto entrepreneur to avoid spending time at the Metropolitan Detention Center. The MDC is a pre-trial holding facility that former inmates and rights advocates have described as inhumane, citing frequent lockdowns, overcrowding and power outages that have left it without heat in the middle of winter.

Federal prosecutors last week charged Bankman-Fried with defrauding investors and customers of FTX, which he founded in 2019. If convicted on all eight charges of fraud and conspiracy, he could face life in prison.

FTX and its sister trading house, Alameda, both filed for bankruptcy last month after investors rushed to pull their deposits from the exchange, sparking a liquidity crisis.

In the weeks since their bankruptcy, FTX’s new CEO has stated publicly that customer funds deposited on the FTX site were commingled with funds at Alameda, which made a number of speculative, high-risk bets. The CEO, John Ray III, described the situation at the two companies as “old-fashioned embezzlement” at the hands of a small group of “grossly inexperienced and unsophisticated individuals.”

—CNN’s Patrick Oppmann contributed reporting.

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Harvey Weinstein: Los Angeles jury deadlocks on factors that could have increased his sentence



CNN
 — 

After convicting former film producer Harvey Weinstein of rape and sexual assault, a Los Angeles jury could not reach a unanimous verdict Tuesday on alleged aggravating factors that could have increased his sentence.

The three charges Weinstein was convicted of – rape, sexual penetration by foreign object and forcible oral copulation – were all tied to one of his accusers, Jane Doe 1, a model and actress who testified the movie mogul assaulted her in a Beverly Hills hotel room in February 2013.

Jurors were asked to determine if Jane Doe 1 was harmed and particularly vulnerable, and if Weinstein committed the crimes with planning, professionalism, or sophistication.

Ten members of the jury found the aggravating factors had been met, but two jurors could not be swayed, one of the jurors told CNN.

“The jury has said they are not able to reach a unanimous verdict on these issues,” Los Angeles Superior Court Judge Lisa Lench said, according to a pool report. “I am going to declare a mistrial with respect to the allegations.”

Had the jury found Weinstein guilty of the aggravating factors, a new California law would have then allowed the judge to enact a harsher sentence.

Jurors had deliberated for several hours Tuesday. After the jury indicated further deliberations would not sway them, neither the prosecution or the defense pushed to have the jurors deliberate further.

When Lench asked prosecutor Paul Thompson if Weinstein will be retried on the deadlock counts, the pool report said he responded: “We need to consult the victims first and foremost.”

Weinstein’s sentencing was tentatively set for January 9, with Lench allowing only Jane Doe 1 to offer a victim impact statement. He is expected to serve 18 years.

“Harvey Weinstein forever destroyed a part of me that night in 2013. I will never get that back,” said Jane Doe 1 in a statement released through her attorney. “The criminal trial was brutal. Weinstein’s lawyers put me through hell on the witness stand. But I knew I had to see this through the end, and I did … I hope Harvey Weinstein never sees the outside of a prison cell during his lifetime.”

The disgraced movie mogul was found guilty Monday of three of seven charges against him in his second sexual assault trial. The jury acquitted Weinstein of one count of sexual battery by restraint against a massage therapist in a hotel room in 2010.

They were a hung jury on one count of sexual battery by restraint, one count of forcible oral copulation and one count of rape related to two other women – including Jennifer Siebel Newsom, a filmmaker and first partner to California Governor Gavin Newsom.

Weinstein had pleaded not guilty to all charges against him. His spokesman said he was “disappointed” with the outcome of the trial but “he is prepared to continue fighting for his innocence.”

The verdict was reached as jurors entered their third week of deliberations, meeting for a total of 41 hours over a period of 10 days following weeks of oftentimes emotional testimony.

Two jurors who spoke with CNN after they were dismissed from court Tuesday shared their thoughts on the trial, both saying politics played absolutely no role in their deliberations.

“Everyone realized the weight of this trial. There’s a lot riding on this for both sides,” said Michael, a 62-year-old juror who declined to share his last name.

Michael said the contact the accusers had with Weinstein following their alleged assaults was a key factor in deciding the verdict. That was specifically applied to Siebel Newsom, who, according to dozens of emails presented as evidence in the trial, maintained contact with Weinstein.

Michael said he found Jane Doe 1 to be the most convincing.

“We felt horrible for everybody,” but felt like the addition of uncharged witnesses became confusing for some jurors, said Jay, another juror who also declined to share his last name.

“Everybody seemed believable. It’s hard to prove all of them with time and memory,” Jay added.

Elizabeth Fegan, an attorney representing Siebel Newsom, who was identified in court as Jane Doe 4, said they were disappointed the jury could not reach a unanimous verdict on the charges related to her client.

“My client, Jane Doe 4, shared her story not with an expectation to testify but to support all the survivors who bravely came forward,” Fegan said in a statement to CNN. “While we are heartened that the jury found Weinstein guilty on some of the counts, we are disappointed that the jury could not reach a unanimous verdict on Jane Doe 4. She will continue to fight for all women and all survivors of abuse against a system that permits the victim to be shamed and re-traumatized in the name of justice.”

Weinstein is two years into a 23-year sentence for a 2020 New York conviction, which his attorneys have appealed, putting more attention on the outcome of the trial in Los Angeles.

The weekslong Los Angeles trial saw emotional testimony from Weinstein’s accusers – a model, a dancer, a massage therapist and Siebel Newsom – all of whom were asked to recount the details of their allegations against him, provide details of meetings with the producer from years ago, and explain their reactions to the alleged assaults.

Additionally, four women testified they were subjected to similar behavior by Weinstein in other jurisdictions.

Weinstein initially faced 11 charges, but four counts connected to an unnamed woman were dropped without explanation. She did not testify in the trial.

In closing arguments, Los Angeles County Deputy District Attorney Marlene Martinez called Weinstein a “titan” who used his power in Hollywood to prey on and silence women.

Meanwhile, Weinstein’s attorneys maintained the allegations are either fabricated or occurred consensually as part of a “transactional relationship” with the movie producer, repeatedly saying there is no evidence of assault.

Defense attorney Alan Jackson called the accusers “fame and fortune seekers.”

Jane Doe 2, who was identified as Lauren Young, told her attorney Gloria Allred by phone that she was happy Weinstein was convicted on some counts despite there being a mistrial on her count, Allred said in a news conference after the verdict.

“I am relieved that Harvey Weinstein has been convicted because he deserves to be punished for the crimes that he committed, and he can no longer use his power to intimidate and sexually assault more women,” Young said in a statement read by Allred.

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Elon Musk says he will step down as Twitter CEO — once he finds a replacement



CNN
 — 

Twitter owner Elon Musk confirmed Tuesday evening he will step down as the company’s CEO, but only when he identifies a successor, directly addressing for the first time a Twitter poll he created this week in which millions of users voted for his ouster.

In a tweet, Musk said he would resign “as soon as I find someone foolish enough to take the job!”

He added that following his resignation as CEO, Musk would “run the software & servers teams” at Twitter, indicating he may continue to exercise significant influence on the company’s decision-making.

The announcement comes after more than a day of silence about the poll following its outcome. On Monday, after more than 17 million users had voted — 57.5% of whom said Musk should resign — the billionaire executive addressed the results only indirectly. He suggested that future Twitter polls could be restricted to paid users of Twitter Blue, the company’s subscription service.

Musk’s poll asking users whether he should resign as CEO came after a massive backlash to Twitter’s abrupt suspension of several journalists who cover him, as well as Twitter’s decision to ban, and then un-ban, links to other social media platforms including Facebook, Instagram and Mastodon, a fast-growing Twitter rival that has octupled in size since October.

Musk’s brief tenure as CEO has resulted in sweeping, occasionally erratic shifts at one of the world’s most influential social media companies.

Under his leadership, Twitter has laid off the majority of its staff, alienated major advertisers, welcomed former President Donald Trump back to the platform after his suspension in the wake of the Jan. 6 Capitol riots and released internal communications to journalists about Twitter’s operations before Musk took ownership of the company.

Musk forced remaining employees to take a pledge to become “extremely hardcore” in their work, and stopped enforcing Twitter’s policy against Covid-19 misinformation.

Over a matter of days, Twitter launched, and then was forced to un-launch, a paid verification feature that was instantly manipulated by satirical accounts impersonating verified major brands, athletes and other public figures on the platform.

Musk’s penchant for making major product changes based on little more than informal Twitter polls has highlighted his ad hoc and improvisational management style. But that approach has attracted growing criticism from many Twitter users. Last week, Twitter suspended several journalists who had reported on Musk’s permanent ban of an account that tracked his jet.

Growing criticism of Musk culminated in Sunday’s poll that served as an effective, if unscientific, referendum on Musk’s handling of the company since he closed his purchase of Twitter in late October.



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Harvey Weinstein: Jury reaches verdict in sexual assault trial



CNN
 — 

[Breaking news update, published at 6:05 p.m. ET]

A Los Angeles jury reached a verdict Monday in the sexual assault trial of Harvey Weinstein, the former movie producer who is accused of using his Hollywood influence to lure women into private meetings and assault them. The verdict will be announced shortly.

Weinstein has pleaded not guilty to seven charges in all: two counts each of forcible rape, sexual battery by restraint and forcible oral copulation, and one count of sexual penetration by foreign object.

If found guilty, Weinstein could face 60 years to life in prison, plus an additional five years.

The verdict was reached as jurors entered their third week of deliberations, meeting for a total of 41 hours over a period of 10 days.

Weinstein was convicted of similar charges in New York in 2020 and was sentenced to 23 years in prison.

[Original story, published at 2:02 p.m. ET]

A Los Angeles jury resumed deliberations Monday in Harvey Weinstein’s second sexual assault trial, meeting for a tenth day to decide on a verdict after weeks of testimony.

The disgraced movie mogul, who is accused of using his Hollywood influence to lure women into private meetings and assault them, awaits a decision from behind bars.

Weinstein faces two counts of forcible rape and five counts of sexual assault related to accusations from four women, including Jennifer Siebel Newsom, a filmmaker and the wife of California Gov. Gavin Newsom, who alleged Weinstein raped her in a hotel room in 2005.

Weinstein has pleaded not guilty to all seven charges against him. He initially faced 11 charges, but four counts connected to an unnamed woman were dropped after she did not testify.

The jury had already deliberated for about 37 total hours when they adjourned last Wednesday, without a verdict reached.

The former film producer is already serving a 23-year sentence for a New York sexual assault conviction. His attorneys have appealed that conviction, which has placed more attention on the outcome of the trial in Los Angeles.

If the jury in Los Angeles finds him guilty, Weinstein could face 60 years to life in prison, plus an additional five years.

The Los Angeles jury has deliberated longer than the New York jury in Weinstein’s first criminal trial, in which he was convicted of criminal sex act and third-degree rape after 26 hours of deliberations.

As deliberations went on in Los Angeles, the jury asked the court a question and at least twice asked for testimony to be read back. Los Angeles Superior Court officials have not provided specifics on those requests.

The weekslong Los Angeles trial saw emotional testimony from Weinstein’s accusers – a model, a dancer, a massage therapist and Siebel Newsom – all of whom were asked to recount the details of their allegations against him, provide details of meetings with the producer from years ago, and explain their reactions to the alleged assaults.

In closing arguments, Los Angeles County Deputy District Attorney Marlene Martinez called Weinstein a “titan” who used his power in Hollywood to prey on and silence women.

“Rapists rape. You can look at the pattern,” fellow prosecutor Paul Thompson told jurors.

“You have irrefutable, overwhelming evidence about the nature of this man and what he did to these women,” Thompson said.

Meanwhile, Weinstein’s attorneys have maintained the allegations are either fabricated or occurred consensually as part of a “transactional relationship” with the movie producer, repeatedly saying there is no evidence of assault.

Defense attorney Alan Jackson called the accusers “fame and fortune seekers.”

The trial in Los Angeles included testimony from the four accusers identified as Jane Does in court, and other witnesses, including experts, law enforcement, friends of accusers and former aides to Weinstein.

Additionally, four women testified they were subjected to similar behavior by Weinstein in other jurisdictions.

Each morning at trial, Weinstein was brought from a correctional facility and wheeled into the Los Angeles courtroom wearing a suit and tie and holding a composition notebook.

His accusers all began their oftentimes emotional testimonies by identifying him in the courtroom as he looked on.

“He’s wearing a suit, and a blue tie and he’s staring at me,” Siebel Newsom said last month, before what was one of the most emotional moments of the trial.

On Thursday of last week, defense attorney Jackson asked jurors if they could “accept what (the Jane Does) say as gospel,” arguing what they said was a lack of forensic evidence supporting their claim.

“Five words that sum up the entirety of the prosecution’s case: ‘Take my word for it,’” Jackson said. “‘Take my word for it that he showed up at my hotel room unannounced. Take my word for it that I showed up at his hotel room. Take my word for it that I didn’t consent. Take my word for it, that I said no.’ “

Siebel Newsom described an hourslong “cat-and-mouse period,” which preceded her alleged assault. She, like other accusers, described feeling “frozen” that day.

Attorneys for Weinstein do not deny the incident occurred, but said he believed it was consensual.

Jackson called the incident “consensual, transactional sex,” adding: “Regret is not the same thing as rape. And it’s important we make that distinction in this courtroom.”

Women’s rights lawyer Gloria Allred, who is representing Jane Doe 2 in the case, told CNN she hopes the jury sees her client “has no motive at all to do anything but tell the truth.”

“She never sought or received any compensation … She doesn’t live in California anymore. But she is testifying because she’s been asked to testify and I hope that they see her as the young woman that she was when she met Harvey Weinstein, and the woman that she is today approximately nine to 10 years later. Her life has changed,” Allred said.

“To be willing to subject yourself to what could be a very brutal cross-examination. That takes a very special person to do that. And she is a special person. I’m very proud,” Allred said.

In her closing arguments, Martinez also highlighted the women who testified chose to do so despite knowing they would face tough conditions in court.

“The truth is that, as you sit here, we know the despicable behavior the defendant engaged in. He thought he was so powerful that people would … excuse his behavior,” Martinez said. “That’s just Harvey being Harvey. That’s just Hollywood. And for so long that’s what everyone did. Everyone just turned their heads.”

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