On Monday , Tesla CEO Elon Musk file his reception to an SEC request to that a Union court hold him in despite for violating asettlement concord . In the filing , Musk argues that limitation on his tweeting amount to an “ unconstitutional index snatch ” by the SEC and that he did n’t even offend the agreement anyway .
The struggle in federal court is the latest sequence in a saga that kicked off last August when Musktweetedthat he was “ considering taking Tesla private at $ 420 ” and that he ’d secured financial support . He had not secure funding , Tesla did n’t go secret , but its stock price decease nuts . The SEC was pissed and essay to get Musk barred from feed a public company . Musk wascavalierabout it until he was n’t and eventuallysettledwith the regulator , agreeing to pay a $ 20 million fine , resign as chairman of Tesla ’s board , and turn tail any tweet that are substantial to Tesla ’s byplay by lawyers before send .
In February , Musk go along totweetthat “ Tesla made 0 cars in 2011 , but will make around 500k in 2019 . ” Realizing the tweet was n’t accurate , he followed up four hours later , clarifying that he meant Tesla ’s manufactory would murder an annualized production rate of 500,000 elevator car in 2019 but only deliver around 400,000 models . Within days , the SECclaimedhe should be held in disrespect because he “ did not search or receive preapproval prior to publishing this tweet , which was inaccurate and disperse to over 24 million people . ”
Intheir responseon Monday , Musk ’s lawyers argued that this display case is about “ a celebratory twine of tweets , expressing exhilaration about Tesla ’s success since 2011 and pride for what Tesla promise achieving in 2019 . ” They say that Musk had simply “ used his discretion ” to regulate the “ tweet was not material ” to the settlement agreement and that the production numbers were already public knowledge as they were let in in an earnings call and an SEC filing . As cogent evidence that he ’s doing his good to comply with the agreement , Musk wrote that he has cut his “ average monthly Tesla related tweet about in half . ”
In an consultation with60 Minuteslast December , Musk was need how Tesla could determine which of his tweets had the potential drop to move the fellowship ’s bloodline Mary Leontyne Price . “ Well , I guess we might make some mistakes , ” he replied . That sort of uncertainty has led Musk ’s attorneys to argue that the settlement amounts to a usurpation of their client ’s First Amendment right wing . They wrote that the SEC ’s interpretation of the settlement prevents Musk from address about the Tesla business , in general . “ Musk never consented to and would not go for to such a sweeping joke order . ”
The heart of the difference of opinion is that the SEC is n’t defining what Musk ca n’t tweet , but it is say that if he tweets something that could move Tesla ’s stock without proper communication with investors first , he ’ll confront consequences if it was n’t sanction by Tesla ’s lawyers . In this case , the tweets come in after - time of day trading and did n’t have a obtrusive effect on Tesla ’s stock , but investor still are n’t happy and aresuinghim for tweet “ restate misstatements . ”
Ever since he reluctantly agree to steady down with the SEC , Musk has render contempt for the means . He told60 Minutesthat he has no respect for the regulator and later take that his 420 tweet was worth getting fined $ 20 million . In its movement for scorn , the SEC cite the 60 Minutes interview as an example of Musk not being persevering in his effort to comply with the settlement . In their response on Monday , Musk ’s lawyers claim that the contempt explosive charge “ smacks of retaliation and censoring . ”
What sort of event would Musk face for his stubborn insistence on his right to twinge whatever the infernal region he desire ? According to theWashington Post , the SEC could levy more amercement or greater restriction on his societal media action . Peter Haveles , a trial lawyer with the practice of law firm Pepper Hamilton , toldWiredthat if the SEC ’s motion for scorn is grant , “ there is a good likeliness that the District Court will fine Mr. Musk and that it will put him on a little triad , with a strong warning that further violations could result in Mr. Musk being banned for some period of sentence as an military officer or music director of a public company . ”
While it ’s infuriating to watch a man who is in charge of two major companies risk everything because he ’s addicted to post , it ’s also kind of advance in a weird direction . Most of us do n’t have 1000000000 of dollars and the freedom to do virtually anything we desire . Elon Musk does , and what he wants to do is tweet . Anyone can tweet . So the next metre you fire off a situation that makes you proud , think to yourself : “ What I ’m presently experiencing is possibly the most jubilant feeling that Elon Musk can imagine . ” Money ca n’t bribe happiness , but that petite dopamine rush from a retweet is everything .
[ SDNYviaWashington Post ]
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