Enlarge / Elon Musk at a press conference at SpaceX’s Starbase facility in Texas on February 10, 2022. (credit: Getty Images | Jim Watson)
Tesla CEO Elon Musk today asked a federal judge to terminate a 2018 settlement with the Securities and Exchange Commission, saying he’s tired of the SEC using the consent decree to “micro-manage” his Twitter activity and that he was “forced” into signing the deal. Musk also wants the court to quash an SEC subpoena that seeks documents related to whether he got pre-approval before posting a recent tweet about Tesla stock sales.
“Unlike other consent decrees, the SEC interprets the agreement in this case to permit it to micro-manage Mr. Musk’s Twitter activity,” according to Musk’s memorandum of law supporting his motion to quash the subpoena and terminate the consent decree. “Indeed, the SEC believes it may police speech that falls outside the bounds of Section 10(b) of the Securities Exchange Act of 1934, which prohibits fraud in the purchase or sale of securities and statements or omissions of material fact.”
The 2018 settlement required Tesla to impose controls on Musk’s social media statements. The settlement was reached to resolve the SEC’s complaint that “Musk’s misleading tweets” about taking Tesla private caused the stock price to jump “and led to significant market disruption.” Musk and Tesla also each agreed to pay $20 million in penalties.
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