The turmoil at Tesla Inc. reached a fever pitch Friday, as news emerged that two senior executives will leave Elon Musk’s electric-car maker a matter of hours after he smoked marijuana during an hours-long interview with a comedian. Chief Accounting Officer Dave Morton gave notice Tuesday that he was resigning less than a month into the job, according to a filing. Tesla’s stock plunged, then extended declines after Gabrielle Toledano, the head of human resources who’s been on a leave of absence, told Bloomberg News that she won’t rejoin the company. Morton, a former CFO for computer-drive maker Seagate Technology Plc, joined Tesla one day before Musk tweeted that he was considering buying out some investors at $420 a share and taking the company private. The CEO abandoned that effort 17 days later, and in the process drew a subpoena from the Securities and Exchange Commission and a series of lawsuits alleging market manipulation. “Since I joined Tesla on August 6th, the level of public attention placed on the company, as well as the pace within the company, have exceeded my expectations,” Morton said in the filing. “This caused me to reconsider my future. I want to be clear that I believe strongly in Tesla, its mission, and its future prospects, and I have no disagreements with Tesla’s leadership or its financial reporting.” Tesla shares fell as much as 10 percent to $252.25 as of 9:46 a.m. in New York, the steepest intraday drop since June 2016. The company’s 5.3 percent bonds plummeted 4 cents, their biggest-ever decline, to 81.75 cents on the dollar, a record low, according to Trace bond price data. Tesla has long struggled with high turnover among its senior executive ranks, and its finance team in particular has gone through significant tumult lately. In the first quarter of this year, the company lost Morton’s predecessor, Eric Branderiz, and Susan Repo, who was treasurer and vice president of finance. CFO Deepak Ahuja retired in 2015, only to return in 2017 after his successor, Jason Wheeler, quit after just 15 months. By leaving, Morton walked away from a $10 million new-hire equity grant that would have vested over four years. Musk, 47, sipped whiskey during a more than 2 1/2-hour podcast with comedian Joe Rogan late Thursday that touched on everything from flame throwers and artificial intelligence to the end of the universe. While he said he was “not a regular smoker of weed,” he took a drag from what Rogan described as a joint containing tobacco mixed with marijuana, which is legal in California. “It’s quite hard to run companies. Especially car companies,” Musk said. “It’s very difficult to keep a car company alive.” The Leadership Brief. Conversations with the most influential leaders in business and tech. Please enter a valid email address. * The request timed out and you did not successfully sign up. Please attempt to sign up again. Sign Up Now An unexpected error has occurred with your sign up. Please try again later. Check the box if you do not wish to receive promotional offers via email from TIME. You can unsubscribe at any time. By signing up you are agreeing to our Terms of Service and Privacy Policy . This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply. Thank you! For your security, we've sent a confirmation email to the address you entered. Click the link to confirm your subscription and begin receiving our newsletters. If you don't get the confirmation within 10 minutes, please check your spam folder. Contact us at letters@time.com.<doc-sep>Tesla stock plunged 9 percent on Friday after a bizarre podcast in which CEO Elon Musk smoked weed and sipped whiskey, and two high-profile executives abruptly announced they were leaving the company. Musk has found himself at the center of a lot of buzz in recent months, including some questions about whether he’s been using drugs — legal or illicit — and he may have provided the answer himself during a Thursday night podcast by comedian Joe Rogan. Musk smoked what Rogan described as a joint containing a mix of marijuana and tobacco. “I’m not a regular smoker of weed,” the Tesla chief executive told Rogan and his podcast listeners. The U.S. Air Force launched an investigation into the matter as Musk's SpaceX has multiple high-value contracts with the military branch, CNBC reported on Friday. The episode quickly added to the growing controversy over the South African-born executive’s behavior in recent months and increased concerns that Musk might be using other drugs. In an emotional August interview with The New York Times last month, the CEO said he was working as many as 120 hours a week, admitting that friends were worried he was facing exhaustion. The Times also quoted sources claiming that some members of the Tesla board were worried about Musk’s use of the sleeping drug Ambien. Then, last month, rap singer Azealia Banks, a friend of the singer Grimes, whom Musk has been dating, claimed in a tweet that she saw Musk high on LSD at the time he tweeted about taking Tesla private. That short-lived plan has triggered an SEC investigation, as well as at least two lawsuits filed by short-sellers who claim it resulted in losses of hundreds of millions of dollars. Whether Musk has been using drugs, is suffering from exhaustion or, in his words, is struggling through an “excruciating” time of his life, his behavior is raising flags — and also appears to be contributing to the growing loss of talent at the California carmaker. Over the summer, Tesla’s head of engineering, Doug Fields, someone Musk once described as “one of the world’s most talented engineering execs,” unexpectedly quit. Now, two other key executives, including human resources head Gabrielle Toledano and Chief Accounting Officer Dave Morton, are out the door. Morton’s departure was particularly surprising considering he joined Tesla only a month ago — a day before Musk’s infamous tweet suggesting he had “funding secured” to take the carmaker private. Though Morton said “I believe strongly in Tesla,” in a regulatory filing released Friday, he also noted that, "Since I joined Tesla on August 6th, the level of public attention placed on the company, as well as the pace within the company, have exceeded my expectations.” Later on Friday, Musk announced a series of promotions to fill a variety of open positions including president of automative and vice president of people and places. Musk has never been shy about public exposure. Like President Donald Trump, he is fond of expressing himself on Twitter but, much like the president, those tweets haven’t always generated the response he apparenttly expected. Two months ago, Musk got into a flame-war with Vernon Unsworth, a British diver who helped rescue a youth soccer team from a flooded Thai cave. The Tesla CEO had offered to send a mini-submarine to assist in the rescue, something Unsworth dismissed as a publicity stunt. The dispute quickly escalated, with Musk referring to the diver as “pedo guy,” slang for a pedophile. Unsworth threatened to sue and Musk subsequently apologized. But in an unexpected turn this week, Musk revived the dispute, this time referring to Unsworth as a “child rapist,” and urging him to sue. “Musk will be sued — not because of his hopes, but because he deserves to be sued,” responded the diver’s attorney, L. Lin Wood, adding that “Elon Musk’s ongoing campaign of publishing vile and false accusations against Mr. Unsworth is outrageous.” Musk has been picking other fights, deriding the media and, during a May conference call to discuss first-quarter earnings, cutting off several analysts, dismissing their questions as “boring.” Musk’s irreverent behavior has been seen by many of his followers as refreshing. But it is beginning to take its toll on the car company he helped found. The company’s stock has always been volatile but it has grown even more so, bouncing sharply, up or down, after many recent tweets. It neared a record after Musk posted about taking Tesla private, then fell by double digits just days later. This week, it took another fall as Musk renewed his attack on Unsworth. At the same time, its high-yield bonds tumbled to record lows. But Tesla has a history of bouncing back, and there were signs this week that investors are being buoyed by increases in production at the company’s Fremont, California, assembly plant — and the announcement, by Musk, that Tesla’s three product lines were the three best-selling EVs in America last month. That gives the CEO credibility on what matters most to many investors: his promise of profits for the second half of 2019 after years of heavy losses. But not everyone is calmed by those numbers. Funds run by Black Rock voted in favor of a recent shareholder proposal that would have required the carmaker to appoint an independent chairman. The measure failed to pass. Meanwhile, Tigress Financial Partners analyst Ivan Feinseth told Reuters that Musk “should not tweet about things outside of car production and the auto industry.” Referring to the SEC probe over the aborted privatization plan, Feinseth added that “the board, even though it is friendly to him, has now been put in a position where the internal governance of the company has been questioned.” While a sip of whiskey and a hit off a joint may be precisely what some executives need after a tough day at the office, Musk’s behavior appears to be making things tougher for himself, and for Tesla. CORRECTION (SEPT. 7, 2018, 11:55 A.M. ET): An earlier version of this article misspelled the first name of the comedian who hosted the podcast. He is Joe Rogan, not Josh.<doc-sep>Some states like California, where Rogan's podcast is recorded, have legalized the plant for recreational use. However, marijuana is still illegal according to U.S. federal law. U.S. Attorney General Jeff Sessions rolled back President Barack Obama-era policies in January that previously dictated the Justice Department would not pursue cases against those who violated federal marijuana laws in states where pot had been legalized. Tesla also asks that you do your part by following safety and health rules and practices and reporting (either openly or confidentially) accidents or any unsafe equipment, behavior (such as use of illegal drugs) or conditions to your manager, supervisor, Human Resources or the Legal Department. Violence and threatening behavior are not permitted, and under no circumstances should you bring a weapon to work. Employees should report to work without being under the influence of illegal drugs or alcohol. The use of illegal drugs in the workplace will not be tolerated. One could argue Musk was representing Tesla as its CEO during the interview. By imbibing alcohol and marijuana, he was "under the influence" while at work. In an email to The Guardian, Musk said, "Our policy allows trace amounts of THC [an ingredient of cannabis] during work times, provided they are below the safety limit (much like a minimum alcohol level)." This isn't the first time there's been concern about Musk's drug use. Tesla board members have also raised concerns over Musk's consumption of recreational and prescription drugs, according to The New York Times. In particular, sources told the publication that Musk's use of sleeping aid Ambien may be having a negative effect, causing him to ramble on Twitter. Tesla did not immediately respond to a request for comment. The company's shares were down as much as 9 percent on Friday morning and closed down 6 percent.<doc-sep>
Tesla shares slipped lower in pre-market trading Friday following news that a key short-seller is suing the clean-energy carmaker for allegedly misleading investors over plans to take the company private and a radio interview that raised further questions over the judgement of founder and CEO Elon Musk. Short sellers lament burn, Tesla burns cash, Musk burns weed ... Tesla Inc. (TSLA) - Get Report shares plunged to the lowest level in five months Friday following news that a key short-seller is suing the clean-energy carmaker for allegedly misleading investors over plans to take the company private and a radio interview that raised further questions over the judgement of founder and CEO Elon Musk. Shares extended also declines after the company said its chief accounting officer, Dave Morton, had resigned after less than a month in the job. Andrew Left, who runs Citron Research, filed his suit against Tesla at the U.S. District Court in San Francisco Thursday, alleging Musk "artificially manipulated the price of Tesla securities with objectively false tweets in order to 'burn' the Company's short-sellers" when he sent his now infamous "taking Tesla private. Funding Secured" message on August. 7. News of the suit, one of seven that targets the Palo Alto, Calif.-based group, was soon followed by an appearance from Musk on the Joe Rogan podcast, in which he smoked marijuana, drank whiskey and told the comedian during the two and a half hour interview that it was "very difficult to keep a car company alive." "I'm not a regular smoker of weed," Musk said. "I don't actually notice any effect. I don't find that it is very good for productivity." Tesla said the company's accounting functions will be overseen by CFO Deepak Ahuja and the group's corporate controller, according to a filing with the U.S. Securities and Exchange Commission. "Since I joined Tesla on August 6th, the level of public attention placed on the company, as well as the pace within the company, have exceeded my expectations," Morton said in the statement. "As a result, this caused me to reconsider my future." "I want to be clear that I believe strongly in Tesla, its mission, and its future prospects, and I have no disagreements with Tesla's leadership or its financial reporting," Morton added. Tesla shares were marked 9.9% in the opening minutes of trading Friday before paring the decline to around 6.3% and changing hands at $263.46 each, a move that takes the stock to the lowest level since April 2 and some 37% from the $420 price that Musk indicated he had funding support to purchase the shares in the open market. Musk's public behaviour since the August Tweet has raised serious questions over his ability to run a public company, with the billionaire founder himself telling the New York Times last month that the past year has been the "most difficult and painful" of his career. Since that interview, however, Musk has courted controversy -- and added to his increasingly active legal calendar -- by reviving a spat with Vernon Unsworth, a British diver who was part of the rescue team that extracted twelve Thai boys from a local football team, along with their coach, trapped in a cave beneath the Doi Nang Non mountain on the border of Myanmar. "He's an old, single white guy from England who's been travelling to or living in Thailand for 30 to 40 years, mostly Pattaya Beach, until moving to Chiang Rai for a child bride who was about 12 years old at the time," Musk told Buzzfeed in an email earlier this week in which he referred to Unsworth as 'child rapist'. "There's only one reason people go to Pattaya Beach," Musk allegedly told Buzzfeed. Unsworth's attorney, Mark Stephens, have vowed to sue the billionaire for libel. Musk is also facing a probe from the U.S. Securities and Exchange Commission over the August Tweets, with Fox Business News reporting Thursday that one of them is Roel Campos, a former SEC commissioner and partner at the Hughes, Hubbbard and Reed law firm, while other reports suggest he's also drafted Steven Farina of Williams & Connolly. "There's only been two car companies in American history that haven't gone bankrupt," Musk said during the podcast interview. "That's Ford (F) - Get Report and Tesla."