Posted on by

SEC rebuffs Elon Musk’s attempt to get out of ‘funding secured’ settlement



Share

Elon Musk, chief executive officer of Tesla Inc., departs court in San Francisco, California, US, on Tuesday, Jan. 24, 2023. Marlena Sloss | Bloomberg | Getty ImagesThe SEC argued in a letter to the U.S. Court of Appeals for the Second Circuit in New York this week that Tesla CEO Elon Musk still needs a so-called “Twitter sitter,” and that an earlier settlement agreement between them is fully constitutional and valid.Now a centi-billionaire, Musk in 2018 wrote on Twitter that he had “funding secured” to take his electric vehicle company private for $420 per share, and that “investor support” for such a deal was “confirmed.” Tesla trading halted after his tweets, and the price of shares in the automaker, seesawed for weeks.When the SEC charged him with civil securities fraud in response to those tweets, Musk and Tesla settled, signing a revised consent decree in 2019. As part of the settlement, Tesla and Musk each agreed to pay $20 million fines, and Musk agreed to relinquish his role as chairman of the board at Tesla for three years.Among other terms, Musk agreed to a “Twitter sitter,” colloquially speaking. He was supposed to work with a securities lawyer at Tesla who would review and approve his tweets before he posted them in any instance when they may contain material business information about the company.After they struck this agreement, Musk has repeatedly said that he doesn’t respect the Securities and …

Read More