Thursday, June 8, 2023

Elon Musk should honor agreement with regulators on tweet

Elon Musk can’t back out from a deal he made with regulators after his 2018 tweets claiming he had secured funding to take Tesla to the private market sent the automaker’s share price to power companies Died and caused the temporary cessation of business, an appeals court ruled Monday.The order by the US Court of Appeals for the Second Circuit in Manhattan was issued just days after a three-judge panel heard arguments from attorneys in the case.

Musk last year challenged a trial judge’s ruling that forced him to abide by the agreement, arguing that circumstances had changed and because the decree contained a “priority restriction” that Musk says violates the First Amendment. violates.

His tweets first needed to be approved by a Tesla lawyer in order to settle with the Securities and Exchange Commission. It also demanded that Musk and Tesla pay civil penalties for tweets in which Musk said he had “secured funding” to take Tesla private at $420 per share.

Funding was not secured and Tesla remains public.

The Second Circuit Court said in its decision that “there is no evidence to support Musk’s contention that the US Securities and Exchange Commission (SEC) issued a consent decree to investigate harassment and bad faith in his freedom of expression.” it used.”

Instead, he said, the SEC “conducted only three investigations of Musk’s tweets since 2018” and that each of the challenged tweets “violated the terms of the consent decree.”

The appeals court also rejected Musk’s prior restraint argument, saying that parties entering into consent clauses can voluntarily give up their First Amendment and other rights.

Lawyers in the case did not immediately respond to messages seeking comment.

The SEC was investigating whether the Tesla CEO’s November 2021 tweets, in which he asked his Twitter followers whether he should sell 10% of his Tesla shares, violated an October 2018 agreement that the SEC filed against him. Musk signed on after filing a complaint. violated anti-fraud provisions of the securities laws regarding taking Tesla private.

Nation World News Desk
Nation World News Desk
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