An arbitration panel determined Trevor Milton owes his former company for costs and damages it incurred due to his controversial actions.
A regulatory filing from Nikola revealed former CEO and founder Trevor Milton has been ordered to pay the company about $165 million in damages. The update appears to have been appreciated by investors, as NKLA stock ended the day up 8.9%.
Nikola said an arbitration panel in New York determined Oct. 20 the company was due the funds for costs and damages it incurred due to its previous CEO’s controversial actions.
“[Nikola] had sought reimbursement from its founder and former executive chairman for costs and damages arising from actions that were the subject of government and regulatory investigations, including the December 2021 SEC settlement and associated civil penalty. The company intends to file with the arbitration panel an application to recover attorneys’ fees related to the matter,” the filing read.
As noted in a CNBC report, Nikola agreed in December 2021 to pay a fine of $125 million to the SEC to settle allegations the company defrauded investors about its products, business prospects and technology. Nikola is also looking to secure reimbursement for its attorney fees.
Prior to his controversial resignation from Nikola in September 2020, Milton was considered by media outlets one of the up-and-coming leaders in the sustainable transport sector.
Milton’s unraveling was triggered by an expose from Hindenburg Research, which accused Nikola of making false statements about its projects, like the Nikola One. Milton was found guilty in federal court in 2022 of three counts of fraud. His sentencing is expected to be held Nov. 28.