US security regulators have been reluctant to take Elon Musk back to court over Tesla Twitter posts, documents show
- The Securities and Exchange Commission has not taken Musk to court to enforce a 2018 agreement since a judge’s 2019 remarks telling the parties to ‘work this out’
- Musk did not have dozens of tweets about Tesla vetted before posting, as he agreed to four years ago, as lawyers said they did not contain material information
The US Securities and Exchange Commission (SEC) asked the court to hold the billionaire in contempt, saying a tweet by the Tesla Inc CEO – which forecast production at the carmaker – violated a court agreement Musk signed the previous year to have some of his communications vetted by a lawyer.
By trying to rein in his comments, the SEC was veering into relatively uncharted territory. SEC rules require that public companies and their executives disclose accurate information that may be material to investors via channels that investors know to monitor. It doesn’t usually specify how companies should do that.
But the 2019 remarks by judge Alison Nathan – who found the terms of the agreement between Musk and the SEC to be “soft” and urged them to reach an understanding – knocked confidence among officials overseeing the case that the courts would support them if they attempted to prosecute his activity on Twitter, the four sources said.
Interviews with individuals familiar with the situation – as well as a review of court documents, SEC and Tesla emails obtained by the media through a public records request – showed that in the wake of Nathan’s comments, SEC officials opted to urge Musk to comply with the agreement, rather than pursuing enforcement through the courts.
Spokespeople for the SEC declined to comment on its enforcement dealings with Musk. Spokespeople for Tesla and Twitter and a representative for Judge Nathan did not respond to requests for comment for this story.