The 9th Circuit Court of Appeals issued a memorandum and disposition on Wednesday, rejecting claims from a group of Tesla investors that the instructions a judge gave to jurors before they cleared Musk of liability in a February 2023 verdict were flawed and so warranted a new trial.

In the ruling, the three-judge panel concluded that there were no errors in jury instructions that would justify a new trial. The court also found that the instructions did not unfairly raise the burden of proof for the investors, and that the instructions were in line with the law.

"Even if there had been an instructional error, it was 'more probably than not harmless,'" the three-judge panel wrote, adding that, during their two-hour deliberations, the jurors asked no clarifying questions.

The appellate court noted that much of Musk's trial focused on whether his tweets were important enough to affect investor decisions. The court found that the jury could have reasonably decided they weren't, weakening the investors' claims for billions in damages.

"A jury considering the evidence—which included testimony about a 'handshake deal' to take Tesla private and about a rise in Tesla's stock price after Musk's August 13th blogpost—could reasonably have found that the essential element of materiality was not established," the judges wrote.

The case stems from a lawsuit brought by Tesla investors, who argued that Musk's 2018 posts on Twitter, including the widely scrutinized "funding secured" post, caused significant volatility in the company's stock price. The investors claimed the tweets were materially misleading and led them to suffer as much as $12 billion in financial losses.

During a three-week trial, Musk's defense argued that he believed his statements were truthful, citing discussions with Saudi Arabia's Public Investment Fund (PIF) as evidence of potential funding. Musk, who spent hours on the witness stand, testified he met with PIF representatives who expressed strong interest in taking Tesla private, leading him to tweet that funding was secured.