Billionaire Elon Musk wants to terminate an agreement with the US Stock Exchange (SEC), which requires him to have his messages directly related to Tesla’s activity approved by a competent attorney before they are broadcast on social networks.
The head of the auto group, who used to controversy on Twitter, asked a New York judge on Tuesday to annul the agreement made in 2018.
In a letter to Judge Allison Nathan, the billionaire’s attorney, Alex Spiro, said the Securities and Exchange Commission was seeking to “harass Tesla and silence Mr. Musk.”
The requirement to obtain pre-approval for messages was one of the penalties imposed by the Securities and Exchange Commission after a tweet published in 2018, in which Mr. Musk claimed he had the appropriate funding to remove Tesla from the stock market, without providing evidence.
Following another misleading tweet in early 2019, Mr. Musk agreed to pre-approval of his posts directly related to Tesla’s business.
He explains today that he was “forced” to do so by threats of a lawsuit from the Securities and Exchange Commission.
In the lawsuit, the leader said, the 2018 tweet was “written when I was thinking about taking Tesla out of the stock market, and that I was getting funding and support from investors.”
“I have never lied to shareholders. I will never lie to shareholders. I agreed to (SEC deal) for the survival of Tesla, for the benefit of the shareholders,” he said.
A few hours after Mr. Musk’s legal request, the Securities and Exchange Commission submitted its own application to Judge Nathan.
The regulator wants the $40 million penalty imposed in 2018 on the billionaire and Tesla after a controversial tweet to be returned to affected investors. This fund currently has $41.2 million in accrued interest.
“The Commission’s primary purpose in developing the Distribution Plan is to define a methodology that will allocate available funds in a fair and responsible manner in proportion to the harm to investors caused by the actions of the accused (Mr. Musk and Tesla, editor’s note),” writes the SEC.
For its part, Mr. Musk’s team has criticized the Securities and Exchange Commission for conducting “relentless” investigations into the Tesla chief’s tweets over the past four years.
In November, the CEO sold $6.9 billion worth of Tesla stock in one week, one of the largest sales ever in such a tight period without the sale being restricted or reduced as part of the inheritance.
Even before the regulator released the first documents reporting the sales, Elon Musk took a poll from his Twitter account to see if he should give away 10% of his Tesla stock. About 57.9% of the 3.5 million voters responded in the affirmative.
According to the Wall Street Journal, the Securities and Exchange Commission has opened an investigation to determine whether the 50-year-old South African-born and his brother did not commit to insider trading around the stock sale.
The share price had fallen in the wake of the poll.
The regulator is wondering if Musk warned his brother, who is also a member of Tesla’s board, that he would post this tweet and if Kimbal Musk gave orders as a result.
Asked by AFP, the SEC declined to comment.