The US Securities and Exchange Commission, after being accused by Tesla CEO Elon Musk this week Launching a “harassment campaign” against him, she responded by reminding Musk that this level of federal scrutiny was part of the deal he agreed to after his dirty book plunged him into hot water.
In 2018, the Securities and Exchange Commission accused Musk of making “false and misleading” statements to investors after he tweeted that he had secured funding for a private purchase of Tesla at $420 a share. The deal never materialized, and after investigation, the Securities and Exchange Commission alleged that Musk’s tweet constituted fraud. Tesla, Musk, and the SEC eventually agreed to settle the case, and as part of the terms, Musk was forced to temporarily step down as Tesla’s board chair. In addition, Tesla and Musk paid a total of $40 million in fines and agreed to have some of Musk’s social media posts screened by a securities law expert before they were posted online.
On Thursday, send a Tesla and a mask e-mail To US District Judge Alison Nathan, the federal judge overseeing the proceedings, accusing the Securities and Exchange Commission of using its resources to conduct “endless and baseless investigations” into the company and its CEO.
“The SEC appears to be targeting Mr. Musk and Tesla for a largely relentless investigation because Mr. Musk remains an outspoken critic of the government,” Alex Spiro, Musk’s attorney, wrote. Additional allegations included that the regulator was trying to “muffle its mouth and harass”, and the repeated check-ins appeared to be “calculated to mollify” the billionaire’s exercise of his First Amendment rights.
The letter went on to claim that the Securities and Exchange Commission had “broke promises” by slowing down the distribution of the $40 million settlement to Tesla shareholders, another condition of the deal.
Stephen Buchholz of the Securities and Exchange Commission responded with Letter to the courts On Friday, that ongoing investigative activity Tesla and Musk was describing as harassment was in fact consistent with expectations set by the court overseeing the settlement. And it’s not as if Musk didn’t give the regulator enough reason to keep scrutinizing him: In the years since the settlement, the Securities and Exchange Commission wrote to Tesla repeatedly asking why certain tweets containing material business information were not vetted by the company’s attorneys. As per their agreement. Musk, for being the dwarf that he is, appears to be very happy to continue trampling the hornet’s nest, antagonizing the SEC with tweets like this As of July 2020: “SEC, three-letter acronym, middle word is Elon.”
Regarding getting the money to shareholders, the Securities and Exchange Commission said the process is still ongoing but should be completed within the next month. He also noted that neither Tesla nor Musk had expressed concerns about this issue to the agency before.
“Because of the complexity of the distribution, it took time to develop the allotment plan,” Buchholz wrote. “This process is nearing completion, and in the absence of any unforeseen circumstances, distribution personnel expect to submit the proposed distribution plan for court approval by the end of March 2022.”
Now that the Securities and Exchange Commission has responded to Tesla’s allegations, it is unclear what the next steps for action will be. Previously, Judge Nathan had asked the two sides to work on resolving their dispute rather than returning the matter to the courts, The Wall Street Journal reports. But given Musk’s fondness for theatrical cinema and stirring up legal battles, that solution seems unlikely.
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