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Ex-CEO ordered to pay Nikola $165M in damages

Published Oct 25, 2023 20:36
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A regulatory filing from Nikola (NASDAQ:NKLA) revealed the company’s former CEO and founder, Trevor Milton has been ordered to pay the company $165 million in damages.

Nikola stated that an arbitration panel in New York ruled in its favor last week, awarding the company funds to cover costs and damages resulting from the controversial actions of its former CEO.

“On October 20, 2023, an arbitration panel in New York, New York awarded Nikola Corporation (the “Company”) approximately $165 million plus interest in an arbitration proceeding with the Company’s founder and former executive chairman,” the filing read.

According to the report, Nikola had sought reimbursement from Milton relating to costs and damages stemming from the former executive’s actions that led to government and regulatory investigations.

According to a CNBC report, Nikola had previously agreed in December 2021 to a $125M fine imposed by the SEC to settle accusations of defrauding investors regarding its products, business outlook, and technological capabilities. Nikola is currently pursuing reimbursement for its legal expenses as well.

Before his controversial departure from Nikola in September 2020, Trevor Milton was regarded by media sources as a rising figure in the sustainable transportation industry. Some Tesla (NASDAQ:TSLA) short sellers even drew favorable comparisons between Milton and Tesla CEO, Elon Musk.

The end of Milton’s tenure was triggered by an expose from Hindenburg Research that accused the company of lying about its projects, including the Nikola One. Last year, Milton was found guilty of three counts of fraud in federal court. He will be sentenced on November 28.

Shares of NKLA are down 2.88% in afternoon trading on Wednesday.

Ex-CEO ordered to pay Nikola $165M in damages
 

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