The Securities and Exchange Commission (SEC) in the U.S. has requested that a judge hold Elon Musk in contempt of court for tweeting.
The SEC is claiming that the tweet in question is inaccurate and violates the settlement Musk came to with the agency in 2018.
It's arguably unfathomable that any human being slapped with a $US20 ($28) million fine for a bad tweet would ever consider returning to the platform, much less continue to fire off word salad at all hours of the day and night. In the face of any logical explanation, however, one such man seemingly continues to insist that he is not owned.Read more
The SEC settlement was come to back in August 2018 as a result of “false and misleading” statements made by Musk on Twitter in regards to privatising Tesla.
It’s been widely referred to as the ‘420 tweet’ and is believed by some to have been a marijuana reference to amuse his girlfriend Grimes.
Am considering taking Tesla private at $420. Funding secured.— Elon Musk (@elonmusk) August 7, 2018
As a result, both Tesla and Musk paid a $US20 million dollar fine each and the latter stepped down as Chairman of the company, though still remained CEO.
But it seems that Musk hasn’t learned his lesson.
His latest potentially-damaging tweet was posted on February 19 and stated that Tesla would produce half a million cars in 2019.
However, Tesla had officially stated to investors weeks earlier that it would only build 400,000 this year.
Musk back peddled the next day, with the help of a lawyer, changing the number of cars to 400,000. However, this could still be taken as a violation due to the information having potential material consequence to Tesla shareholders.
Tesla made 0 cars in 2011, but will make around 500k in 2019— Elon Musk (@elonmusk) February 20, 2019
Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for year still estimated to be about 400k.— Elon Musk (@elonmusk) February 20, 2019
Part of Musk’s agreement with the SEC was in relation to the CEO’s penchant for tweeting financial information about Tesla.
Musk also agreed to legal approval regarding all tweets that may have a financial impact on Tesla. However, in December he revealed on the U.S. edition of 60 Minutes that that nobody is approving his tweets.
This tracks with the SEC’s allegations that Musk didn’t seek legal approval for the February 19 tweet, which was apparently confirmed with Tesla’s legal counsel on February 22.
There are currently no details in regards to next steps, though a hearing is expected in the near future.