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Tesla Co-Founder Settles Suit (September 18, 2009)

Erstwhile and embittered Tesla Motors CEO Martin Eberhard settled his defamation lawsuit against the electric car company today.

The terms are confidential, but the warring parties kissed and made up in a joint statement, and settled once and for all just who the hell founded the hottest clean-tech startup in the Valley.

Aaaaannnnd the winnah is …

“Elon Musk and Martin Eberhard, two of the co-founders of Tesla announced today that they have resolved their dispute,” says the soon-to-be-released announcement.

That whole “co-founder” title was kind of a touchy subject. In his defamation suit, Eberhard claimed that CEO Musk was stealing his thunder by declaring himself the founder of Tesla in interviews — and even tried (unsuccessfully) to get the court to declare him a Tesla founder. The suit was filed in May and also accused Musk of wrongfully and publicly blaming Eberhard for production delays and whole laundry list of misdeeds from not paying his severance when he was ousted two years ago to crashing his Tesla Roadster.

In the statement, Eberhard said Musk wasn’t all that bad: “As co-founder of the company, Elon’s contributions to Tesla have been extraordinary.”

And Musk, who had previously bad-mouthed Eberhard in a lengthy blog post, said “Industry changing efforts are virtually impossible. Without Martin’s indispensable efforts, Tesla motors would not be here today.”

Eberhard's lawyer, Yosef Peretz, said the terms of the settlement were confidential, but said that Eberhard was “very pleased” with the result. Peretz had beaten back the Tesla’s anti-SLAPP motion earlier this summer, the first hurdle for any defamation case. And then on Aug. 7, both sides dismissed the case and went to mediation. Wilson Sonsini had been defending Tesla in court. No doubt brand-new general counsel Jon Sobel is happy to get this pissing match piece of litigation behind him.