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Summary:

Lawyers for electric car startup Tesla Motors, CEO Elon Musk and founder Martin Eberhard will do battle in court tomorrow, the AP reports, as Musk and Tesla try to get Eberhard’s lawsuit thrown out. Nearly a month has passed since Tesla filed a motion calling for […]

tesla-logoLawyers for electric car startup Tesla Motors, CEO Elon Musk and founder Martin Eberhard will do battle in court tomorrow, the AP reports, as Musk and Tesla try to get Eberhard’s lawsuit thrown out. Nearly a month has passed since Tesla filed a motion calling for the court to dismiss Eberhard’s allegations of libel, slander and breach of contract. Now the two sides, vying to gain recognition as the entrepreneurial brains behind the startup as much as anything else, will finally get to air their grievances (hat tip AutoblogGreen).

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Eberhard has called for the court to bar Musk and Tesla from making statements that undermine the status of Eberhard and Marc Tarpenning as the company’s sole founders and creators, or suggest that Musk himself deserves that credit. So as we wrote last month, the dispute highlights the incredible importance of being a founder.

In the official court filing, Musk and Tesla’s lawyers have sidestepped the question of who really deserves the founder title, arguing instead that legal restrictions on using the label would amount to what’s called “prior restraint,” a violation of free speech protections. But unofficially — in the battle for public, if not legal recognition — Musk has just upped the stakes on the founder question, telling the AP in a new interview that he does have claim to the founder label. In the AP’s paraphrase, he explains that: “investments alone did not make him a ‘founder,’ but that his full-time commitment during the last two years to turn around a company gives him claim to the label.”

We’ll leave the legal decisions to the courts. As for the unofficial question of founder’s credit, it is one thing for an executive to take the helm of a startup early on, and “rebuild” it, as Musk says he has done with Tesla, after its initial creation. Musk has made a lot of progress during the most recent leg of Tesla’s turnaround, in which Tesla has worked its way out of serious financial troubles to win one of the first three loans under a long-delayed Department of Energy program, for $465 million, along with an important investment from Daimler AG). But putting in hard work, showing progress and helping to rebuild a struggling company are simply not the same thing as founding it.

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  1. What is new ? This happen to great companies such as Google and Facebook.

    The humble Engineers who designed this product need to recognized.

  2. Paulson Leeds Tuesday, July 28, 2009

    Martin has a right to the money that Tesla has gotten on his and Mark’s sweat. Musk has done many bad things to his wife, staff and investors and he screwed Marty out of his money. If Musk had not created a hostile takeover of Tesla via a force-out, Marty would be making all of that money and getting the $420K per year that Musk is paying himself.

  3. Sassy Pandaz » Blog Archive » This Man Founded Everything (And So Did You) Wednesday, July 29, 2009

    [...] of the real founders of Tesla, ousted CEO Martin Eberhard, argues that Musk didn’t actually start the company. Reasonable! But no barrier to Musk: He has argued he should be called co-founder of PayPal for [...]

  4. Court Gives Green Light for Tesla Founder’s Lawsuit to Proceed Wednesday, July 29, 2009

    [...] label and raised the issue of “prior restraint,” a violation of free speech protections, as we’ve noted before. But Musk told the AP in an interview this week that he does have claim to the founder label, and [...]

  5. MySweetLife.Net » Blog Archive » This Man Founded Everything (And So Did You) [Nerdfight] Thursday, July 30, 2009

    [...] of the real founders of Tesla, ousted CEO Martin Eberhard, argues that Musk didn’t actually start the company. Reasonable! But no barrier to Musk: He has argued he should be called co-founder of PayPal for [...]

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