Trevor Milton, the founder and former CEO of Nikola Corporation, has been ordered by a U.S. federal judge to pay the company nearly $168 million. This ruling upholds the decision from a previous arbitration panel, which Milton contested arguing that the blame was unfairly placed solely on him.
The decision was finalized this week when U.S. District Judge Diane Humetewa confirmed the arbitration panel’s ruling. The panel had concluded that Milton bore responsibility for a significant portion of the penalties and expenses that Nikola incurred due to his actions. (via Reuters)
Specifically, Milton was found liable for 97% of a $125 million fine that Nikola paid to settle fraud charges with the U.S. Securities and Exchange Commission (SEC), as well as for an additional $46.5 million in legal fees and other expenses.
Milton’s troubles began when he was accused of making a series of false and misleading statements about Nikola’s technological capabilities and business progress. Prosecutors alleged that Milton overstated the company’s advancements in key areas such as battery technology and the development of their hydrogen-powered trucks.
Among the claims that landed him in hot water was Milton’s assertion that Nikola had built a groundbreaking pickup truck and made substantial progress with its “Nikola One” semi-truck, claims which were later revealed to be exaggerated or outright false.
The SEC’s investigation into these allegations resulted in a hefty $125 million fine for Nikola, which agreed to settle the charges. The company, however, sought to recover the cost of the fine and associated legal expenses from Milton through arbitration, arguing that his actions were the direct cause of the SEC’s penalties.
Milton was convicted of wire and securities fraud in a separate criminal trial in 2022 and was sentenced to four years in prison. He is currently free on bail pending an appeal of that conviction.
