Twitter lawyer: No 'exit ramp' for Elon Musk out of takeover deal
New York (CNN Business)The Securities and Exchange Commission apparently isn’t done with Elon Musk and his tweets quite yet.
Tesla (TSLA) disclosed in a quarterly regulatory filing Monday that it received a new subpoena from the SEC on June 13, related to “our governance processes around compliance with the SEC settlement.” That settlement, which stripped Musk of his title as chairman of Tesla while allowing him to remain as CEO, came because of Musk’s 2018 tweet that he had “funding secured” to take Tesla private.
The SEC charged that despite discussions with Saudi investors Musk did not have the funding secured to take Tesla private. As part of that settlement, Musk agreed to that charge and also agreed had to submit any tweet with information that would be material to investors to other executives at Tesla for approval before sending it out.
Musk has been bitterly critical of the SEC since that settlement. At a TED conference earlier this year, Musk said he agreed to a settlement only because if he continued to fight the agency, Tesla’s banks would have cut off funding at a time when it needed cash.
“I was forced [to lie] to save Tesla’s life and that’s the only reason,” Musk said at the TED conference in April.
He went on to compare the experience to having someone point a gun to his child’s head.
Musk’s lawyers also filed complaints with the federal judge overseeing the settlement complaining that the SEC is attempting to “chill his exercise of First Amendment rights” because Musk is an “outspoken critic of the government.”
In addition to its investigation of Musk’s role at Tesla, the SEC is looking into his tweets about his effort to buy Twitter (TWTR). The agency sent sent a letter to Musk on June 2 with questions about his tweets related to the buyout effort, including his tweets about the deal being paused, according a Thursday regulatory filing. The agency had already questioned Musk in an April letter about his apparent delay in disclosing his large ownership stake in Twitter.
Tesla had previously disclosed a subpoena related to an SEC probe of the settlement in November 2021. Tesla wrote in the Monday filing that the company “routinely” cooperates with regulatory and governmental probes, including subpoenas. The SEC did not have a response to questions about its latest subpoena to Tesla.
— CNN Business’ Clare Duffy contributed to this report.
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