Elon Musk, CEO of Tesla and SpaceX, one of the richest men in the world (depending on the day), says the Securities and Exchange Commission (SEC) has tried to “cool” its free speech in a “relentless investigation” to him and the automaker he co-founded. The SEC, Musk’s lawyers argue, “broke its promises” in a 2018 settlement over a tweet Musk posted in which he said he had received funding to take Tesla private.
Worst of all, the SEC appears to be targeting Mr. Musk and Tesla for unrelenting investigation, in large part because Mr. Musk remains an outspoken critic of the government, the letter said. appear to be designed to impartially enforce its exercise of First Amendment Rights rather than generally applicable laws.”
Musk’s attorneys made the allegations in a letter to Judge Alison Nathan, who oversaw the 2018 settlement. Musk was accused of making false and misleading statements. Under the terms of the agreement, he had to pay a $20 million fine and resign as Tesla chairman for three years. Tesla also had to pay a separate $20 million fine and keep an eye on Musk’s statements about the company on Twitter and elsewhere.
The SEC asked a federal judge to contempt Musk in February 2019 for a claim tweet that Tesla would make “about” 500,000 cars that year. That contradicted the company’s official guidelines that it would deliver between 360,000 and 400,000 cars in 2019. The SEC said Musk is “blatantly violating” the settlement; Musk said the SEC was trying to make an “unconstitutional coup.” Nathan ordered the two parties to “come back with your reasoning pants on” and work things out.
The November 2021 subpoena goes against a tweet that Musk posted to gauge his followers whether he should sell 10 percent of his Tesla stake. Shares of Tesla fell 16 percent in trading days after the tweet.
In addition to allegedly stifling his freedom of speech, Musk’s attorneys write in the latest letter, the SEC has not yet paid out $40 million to shareholders as agreed in the settlement. “Mr. Musk and Tesla understood that a settlement with the SEC would ultimately end the SEC harassment and, most importantly, make this Court, not the SEC alone, the monitor of any future compliance issues,” it said. the letter: “But the SEC has broken its promises.”
Tesla did not respond to a request for comment on Thursday; the company has dissolved its news agency and usually does not respond to questions from the media. The SEC did not immediately respond to a request for comment on Thursday.