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The judge rejects Nikolas' founder's offer to reject the fraud case



(Reuters) – A US judge on Monday refused to dismiss a federal indictment accusing Nikola Corp. billionaire founder Trevor Milton of deceiving investors about the electric and hydrogen-powered truck manufacturer's technology.

U.S. District Judge Edgardo Ramos dismissed Mr. Milton's claim that he should not have been prosecuted in New York for securities fraud and wire fraud because his alleged lies were in Arizona and Utah, where he lives, and the case belonged there at all.

The Manhattan-based judge said Milton, 39, could be brought to justice in New York if he traded Nikola shares on the Nasdaq and communicated false statements to that state.

Judge Ramos said other factors also supported the case being held in New York. York despite Mr. Milton's desire to take care of his wife at home, who according to court papers has an autoimmune disease and other "serious" health problems.

Mr. Milton's lawyers did not immediately respond to requests for comment. They have called the indictment "legally deficient" and plan to request dismissal on material grounds.

Nikola has not been charged with any crime.

Authorities said Mr. Milton used a flash of posts on social media, TV and podcast interviews to push up Nikola's stock price for nearly a year. batteries that he knew he was buying elsewhere, and was making progress on a truck prototype that he knew did not work.

Mr. Milton founded Phoenix-based Nikola in 201

4 and was CEO until June 2020, when it was listed after merging with a special purpose acquisition company. SPACs, a growing market, are investment instruments that allow sponsors to take private companies to the stock market faster than through IPOs, but which critics believe are prone to conflicts of interest and fuzzy due diligence.

Nikola and other start-up vehicles have used SPAC in hopes of get high market valuations, like Elon Musk's Tesla Inc.

Prosecutors are also investigating electric car maker Lordstown Motors Corp. on its SPAC and statements on vehicle pre-orders.

The case is US v Milton U.S. District Court, Southern District of New York.

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