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Tesla CEO responds to lawsuit from former CEO

Current Tesla Motors CEO Elon Musk responds in lengthy blog to lawsuit filed against himself and company by former CEO Martin Eberhard.

Tesla Motors Chairman and CEO Elon Musk
Tesla Motors Chairman and CEO Elon Musk
Tesla Motors

The legal battle and war of words between two Tesla Motors CEOs are heating up.

Current Tesla Motors CEO Elon Musk responded in a lengthy company blog on Monday to a lawsuit charging libel and breach of contract from former CEO Martin Eberhard. In his blog, Musk dismisses Eberhard's claim that Eberhard was responsible for many of Tesla's key achievements, one of the key points of the suit.

Among other comments, Musk writes: "The facts are that when I requested through AC Propulsion to meet Eberhard, he had no technology of his own, he did not have a prototype car and he owned no intellectual property relating to electric cars. All he had was a business plan to commercialize the AC Propulsion Tzero electric sports car concept. Three years later, when Eberhard was asked to leave Tesla, most of the work that he had been paid to do had to be redone."

The battle started when Eberhard filed suit again Musk and Tesla, alleging that Musk was trying to "rewrite history" by taking credit for key accomplishments behind Tesla Motors.

Electric car maker Tesla has been in legal waters before. Last November, the company lost a lawsuit against Fisker Automotive, alleging that Fisker had stolen trade secrets. Last July, former Public Relations Director David Vespremi filed a suit, which was dismissed, against Tesla saying the company violated his terms of employment.

In the wake of layoffs and canceled orders, Tesla has been busy trying to drum up cash to fund its development and manufacturing. The company has applied for a Department of Energy loan to finance construction of a factory.

Corrected at 2:15 p.m. PDT: This article initially misstated the status of Tesla's loan application to the Department of Energy. It has applied for a DOE loan but has not yet received it.