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Abu Dhabi, UAESaturday 21 July 2018

Ex-Tesla worker escalates legal battle by blowing whistle

Martin Tripp accused the car maker of inflating weekly Model 3 production figures by as much as 44 per cent

The whistleblower told the SEC about Tesla infractions
The whistleblower told the SEC about Tesla infractions

A former Tesla employee portrayed by Elon Musk as a saboteur has filed a whistle-blower tip to the US Securities & Exchange Commission alleging the company made misstatements and omissions to investors.

Martin Tripp, a process engineering technician who left Tesla on June 19 and was sued by the company shortly afterward, accused the car company of inflating weekly Model 3 production figures by as much as 44 per cent. In a tip filed to the SEC on Friday, he also said the company installed unsafe batteries in vehicles that may be at higher risk of catching fire.

Mr Tripp’s allegations were summarised in a statement from Meissner Associates, a New York-based law firm that represented a former Monsanto employee who was awarded $22 million in August 2016 for tipping off the SEC to improper accounting. Stuart Meissner, a former assistant district attorney in Manhattan and assistant New York state attorney general, said he believes Tesla’s lawsuit against Mr Tripp was part of a media campaign to defame and silence him.

The company accused Mr Tripp in a complaint last month of writing a computer program to access proprietary information, sending material to three unidentified entities and attempting to cover his electronic tracks after he was denied a promotion. Mr Musk, 47, wrote an email to employees alluding to the alleged sabotage effort days before Tesla filed its complaint.

Mr Tripp told the SEC that Tesla had installed batteries with holes punctured in them, placed battery cells too close to one another and did not affix them properly.

He also alleged that the company systematically reused parts that that been deemed scrap or waste in vehicles. The National Transportation Safety Board is looking into the flammability of lithium-ion battery packs for electric cars, including several fires involving crashed Teslas.

Whistle-blowers are eligible for payouts if they voluntarily provide the SEC with unique information that leads to a successful enforcement action. Compensation can range from 10 per cent to 30 per cent of the money collected in any case that leads to a penalty of at least $1 million. The SEC said it has awarded more than $266m since the launch of its whistle-blower programme in 2011.