Nikola Corp. founder Trevor Milton’s counsel sought to have his fraud trial moved out of New York, but a federal judge dismissed their request, stating that he purchased and sold shares on the Nasdaq in New York, making the venue proper.
Milton faces three charges stemming from claims that he cheated investors in a new electric vehicle firm by making false statements. He is free on a $100,000 bail pending his trial on April 4, 2022.
Milton claimed that he should not have been charged with securities fraud and wire fraud in New York since his alleged illegal activity took either in Arizona, where Nikola is based or Utah, where he lives. His lawyers intend to appeal the indictment on grounds other than venue.
Milton, 39, could face charges in New York if he traded Nikola stock on the Nasdaq and made fraudulent representations to the state.
Milton’s wife is sick.
Despite Milton’s wish to care for his wife, who, according to court records reported by Reuters, has an autoimmune condition and other “serious” health difficulties, other considerations favor maintaining the case in New York, Ramos said.
According to Reuters, Milton’s lawyers, who could not be reached for comment, described the indictment as “legally deficient” and said they intend to seek a dismissal on substantive grounds.
On July 29, Milton was charged with fraud after boasting about Nikola’s technological achievements and prowess on social media, particularly Twitter.
The case revolves around Milton’s claims that Nikola had produced an electric and hydrogen-powered pickup truck that had never been seen in person, developed batteries that Milton knew the company was getting elsewhere; and was working on a truck prototype that he knew didn’t work.
Nikola is nearing the end of his SEC negotiations.
Nikola has not been charged with any criminal offenses as a firm. It is nearing a $125 million settlement with the Securities and Exchange Commission over Milton’s accusations. Nikola has stated that it will seek reimbursement from Milton, who remains the company’s primary stakeholder.
Nikola was formed in the basement of Milton’s Salt Lake City house in 2014, and the company has since relocated to Phoenix, where it plans to employ 1,000 people by the end of the year.
Following a critical analysis by short-seller Hindenburg Research, Milton quit the company in September 2020. During an internal Nikola investigation, several of the claims made against Milton in the 67-page report were true.
Nikola (NASDAQ: NKLA) has started pre-series manufacturing a Class 8 battery-electric day cab, with regular production set to begin in Q1 2022. It has also constructed prototypes of a hydrogen fuel cell-powered version of the truck.
