After a new fraud charge was leveled against Nikola founder Trevor Milton earlier this week, his attorneys are seeking a 30-day adjournment to review the documents. The move comes less than a month before the electric vehicle startup founder’s criminal trial is slated to start on July 18.
In response to the letter filed by Milton’s legal team, U.S. District Court Judge Edgardo Ramos agreed to set a status conference for Wednesday in the U.S. District Court for the Southern District of New York.
Milton, who is accused of lying about “nearly all aspects of the business” to investors to boost stock sales of Nikola (NASDAQ: NKLA), was initially charged with two counts of securities fraud and one count of wire fraud in July 2021.
In a superseding indictment on Tuesday, Milton was charged with one count of wire fraud. Federal prosecutors allege Milton defrauded the former owners of a Utah ranch in exchange for cash and stock options “based on false and misleading statements regarding Nikola’s business and products,” according to court documents.
As part of the sale of the 4,678-acre Wasatch Creeks Ranch the Nikola founder bought in 2020, the sellers claim Milton provided an option agreement to purchase nearly 516,000 shares of Nikola stock at a strike price of $16.50.
The ranch owners agreed to accept securities as part of the sale of the property, relying on statements made by Milton regarding Nikola’s technical and business achievements.
According to court filings, “once the truth was revealed publicly, the share price of Nikola plummeted and destroyed the value of the option” provided by Milton as part of the Utah ranch sale.
The seller also filed a civil complaint against Milton in March in federal court in Utah. The suit seeks $45 million.
Judge asked to exclude evidence of Milton’s wealth
On Tuesday, Milton’s attorneys filed a motion asking Judge Ramos to exclude evidence of the Nikola founder’s “purported wealth, lifestyle or spending habits” from his trial because it could mislead the jury, according to court filings.
Nikola agreed to pay a $125 million fine to the SEC to settle a complaint based on Milton’s claims in December. It has said it will try to get Milton to reimburse the fine.
Milton resigned from Nikola in September 2020 following a blistering report by short seller Hindenburg Research. The report claimed the Nikola founder had lied to investors about the company’s technological milestones before and after it went public in a special purpose acquisition company merger with shell company VetcoIQ.
Since leaving the company, Milton has shed tens of millions of his once dominant share in the company since the company went public via SPAC in June 2020.
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