Elon Musk Quest to Scrap Deal Over 2018 Tweets is Rejected
Elon Musk’s request to scrap a settlement with securities regulators over 2018 tweets claiming he had the funding to take Tesla private was denied by a federal judge in New York.
Judge Lewis Liman on Wednesday also denied a motion to nullify subpoenas of Musk seeking information about possible violations of his settlement with the Securities and Exchange Commission.
Musk had asked the court to throw out the settlement, which required that his tweets be approved by a Tesla attorney. The SEC is investigating whether the Tesla CEO violated the settlement with tweets last November asking Twitter followers if he should sell 10% of his Tesla stock.
The whole dispute stems from an October 2018 agreement with the SEC in which Musk and Tesla each agreed to pay $20 million in civil fines over Musk’s tweets about having the money to take Tesla private at $420 per share.
The funding was far from secured and the electric vehicle company remains public, but Tesla’s stock price jumped. The settlement specified governance changes, including Musk’s ouster as board chairman, as well as pre-approval of his tweets.
Musk attorney Alex Spiro contended in court motions that the SEC was trampling on Musk’s right to free speech.