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Let's see if the king of late night tweets about rockets and electric cars speaks out on this one.

More details have emerged on a class action securities lawsuit originally filed in Oct. 2017 against Tesla (TSLA) - Get Tesla Inc Report , CEO Elon Musk, current Chief Financial Officer Deepak Ahuja and former CFO Jason Wheeler that alleges the parties misled investors about Model 3 production. As a result, the two plaintiffs -- Kurt Friedman and Uppili Srinivasan -- had their investments in Tesla hurt by the negative market reaction to Tesla's missed Model 3 production goals. 

The amended complaint was filed on Mar. 23.

Tesla shares have lost about 22% since hitting an intra-day high of over $385 in June 2017. While Musk has continued to refute the notion Tesla will need to raise capital this year, the market has increasingly called that into question as well as Musk's credibility.  

What's interesting here is not just the claims on team Tesla (and former in the case of Wheeler), but that former employees have started to speak out. 

A Tesla spokesman did not immediately return a request for comment by TheStreet. Below are several key areas of the lawsuit.


"Beginning on May 3, 2017 and continuing throughout the Class Period, Defendants misrepresented to investors the then-current state of affairs with respect to whether the Company was on track to mass produce the Model 3 in 2017, and whether progress had been made supporting Defendants claims that 5,000 Model 3s per week would be produced before the end of 2017. Defendants statements were false."

"Serious supply chain and production problems existed by the beginning of the Class Period, including incomplete and/or non-existent automated production lines, causing unresolved bottlenecks at both the Company's Fremont, California assembly line and at Tesla's Gigafactory, its purportedly state of the art, Nevada battery manufacturing facility. These issues rendered mass producing the Model 3 in 2017 impossible. Defendants knowingly or recklessly misrepresented the then-existing facts on the ground, and misrepresented the Company's ability to mass produce the Model 3 by the end of 2017." 

"All of Defendants statements regarding progress that the Company had achieved in both Fremont and at the Gigafactory, and the statements they based on these affirmative declarations of actual progress in Model 3 mass production, were false."

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"As early as mid-2016, Tesla executives responsible for planning and building the Model 3 production line plainly told Defendant Musk and the other Defendants in person, providing specific support for their statements that the Company could never mass produce the Model 3 by the end of 2017. These Tesla executives told Musk and the other Defendants that it was an impossible goal."

"In May 2017, when Defendants stated that the Company was on track to meet its mass production goal, as production on a fully automated production line was supposed to be ready to begin, and in August 2017, when production on a fully automated production line was supposed to have already been in place and Model 3s were supposed to be coming off the line, according to a number of former employees, the Company had not yet finished building its automated production lines in wither Fremont or Nevada. Tesla was neither ramping up mass production, nor on track to mass produce Model 3s at any time on or around the end of 2017."

"Defendants Musk and Ahuja, who visited the Fremont facility on a regular basis, knew that the Model 3 production line was way behind the publicly announced schedule and that it would never mass produce the Model 3 in 2017."

"As Defendants claimed to be on track for mass production in 217, the Fremont facility was assembling Model 3s, by hand, in the beta or pilot shop, a facility to assemble prototypes. The actual mass production line at Freemont was yet to be completed. Workers in the pilot shop were not even able to build enough Model 3s to carry out the necessary testing on the vehicles, and most Model 3 workers were being reassigned, or spending their days cleaning. It was evident to anyone who visited the Fremont facility and Musk himself visited the unbuilt production line area every Wednesday, known internally as Elon Day that the production line was not yet built, that parts for the necessary robots were not present, and that construction workers were spending most of their shifts sitting around with nothing to do. Multiple former employees corroborate the fact that there was no fully functioning automated production line when Tesla was telling the world that there was, and that the construction site where the line was being built was clearly and visibly far from completion."

"Further, in May 2017, when Defendant Musk stated specifically that, based on what Tesla had already accomplished, the Company was on track to mass produce Model 3s in 2017, the Gigafactory did not have sufficient fully functioning production lines, batteries were being built by hand, and only a handful were being produced per week. As in Fremont, the facts on the ground at the Gigafactory, which Musk himself visited, belied Musk's on track comment, as well as all of the Company's subsequent statements during the Class Period."

"Former employees state that there was no chance that the Gigafactory would produce 5,000 batteries per week at any time in 2017, and mass production of Model 3s required mass production of Model 3 batteries."

"Multiple former employees, at both the Fremont facility and at the Gigafactory, have confirmed what was obvious to anybody walking through those facilities both before and during the Class Period. Tesla was never on track for mass production of the Model 3 before the end of 2017, much less on track to produce 5,000 Model 3s per week before the end of 2017, and the progress which Defendants claimed had occurred and supported their mass production statements was illusory."

"Without a mass production line and without batteries, it was impossible for Tesla to mass produce the Model 3 in 2017, and Defendants knew Tesla had neither."

"On October 6, 2017, the Wall Street Journal published an article, based in part on eyewitness observations by workers at the Fremont plant, that very few Model 3s were being built, and the Model 3s that were completed were being built almost entirely by hand, and not on a finished production line. On this news, Tesla's stock dropped $13.94, or 3.91%, to close at $342.94 on October 9, 2017, damaging investors."

"Throughout the Class Period, Defendants made false and misleading statements and failed to disclose that: (i) contrary to Defendants representations that the Company was prepared for mass production of its Model 3 sedan by year-end 2017, in reality, the Company did not have working production lines, and could not possibly build the production lines in the promised timeframe, and was woefully unprepared to mass produce the Model 3 sedan and Model 3 battery as claimed; (ii) as a result, Defendants public statements about the state of affairs in Fremont and at the Gigafactory necessary to support mass production, and their statements about the scheduled date for commencement of mass production of the Model 3 were false and misleading at all relevant times."