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Nikola Threatens Bloomberg With Lawsuit Over Article That Said Founder Exaggerated The Capability Of Company's Debut Truck

Nikola Threatens Bloomberg With Lawsuit Over Article That Said Founder Exaggerated The Capability Of Company's Debut Truck

Nikola Corporation (NASDAQ: NKLA) Chief Executive Officer Trevor Milton on Wednesday said the company had served a legal notice to Bloomberg and its business writer Edward Ludlow for libel over an article published earlier that day.

Milton Exaggerated Truck Capability, Bloomberg Says

Citing inside sources, Ludlow had written for Bloomberg that Milton exaggerated the capabilities of the company's first pickup truck, the Nikola One, at the December 2016 unveiling event. The hydrogen fuel-cell truck was inoperable, and missing key components to power itself, unlike what Milton claimed at the time, sources told the reporter.

According to Bloomberg, there was not even a fuel cell on board the Nikola One truck, a vehicle that advertised itself as a "H2 Zero Emission Hydrogen Electric." Milton had said at the time that "this thing fully functions and works," and that the company had put a chain "to keep people from driving off."

In an interview with the publication on Wednesday, the Nikola CEO backtracked, saying key parts were taken out for safety reasons, and that the truck never drove on its own power. "I never deceived anyone," he said. Ludlow further went on to cast doubt on Nikola's operational ability, saying the touted 10,000 truck deliveries a year are unlikely to happen until at least 2030, quoting research from BloombergNEF.

Nikola Threatens Defamation Lawsuit

"Many of the statements in your article were inaccurate, misleading, taken out of context and hide behind alleged inside sources who conveniently ‘asked not to be identified discussing sensitive information,'" Nikola Chief Legal officer Britton Worthen said in a legal notice to Bloomberg, saying the company was advancing with a libel lawsuit. "This was clearly done with the intent to wrongfully harm Nikola using knowingly false information to construct a blatant hit piece."

"He [did not] validate the bad information he got. [He] never interviewed the crowd who came, the engineers who work here and he intentionally did not report the truth from my interview this morning. You can lie but you [will be held accountable." Milton said in a tweet. "I am sticking up for [you,] the shareholder," he added.

Price Action

Nikola shares closed 1.8% higher at $64.06 on Wednesday. The shares traded another 0.3% higher in the after-hours session.


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