Elon Musk fires back at SEC on twitter

Elon Musk fires back at SEC on twitter

Elon Musk fires back at SEC on twitter

The SEC did not ask for a specific punishment for Musk's alleged violations of the settlement, but legal experts said the consequences could be severe, including an expensive penalty or forcing Tesla to take additional steps to rein in its CEO.

The Securities and Exchange Commission sought the order following a February 19 tweet from Musk about auto production numbers that was not approved by a Tesla lawyer.

But Gordon expects Musk will do it again, and that would trigger more significant action from the court.

Musk initially contended that he hadn't done anything wrong, but reluctantly agreed to have future tweets that could affect Tesla's stock pre-approved.

The Securities and Exchange Commission sought the order after a February 19 tweet from Musk about auto production numbers that wasn't approved by a Tesla lawyer. He tweeted again later that he "meant to say" weekly production would equal to half-a-million cars.

But the damage had been done - and on two fronts, because the SEC determined that the billionaire entrepreneur hadn't gotten pre-approval from Tesla lawyers before posting the "500k" tweet.

According to Lutzker, who now works for the law firm Davidoff Hutcher & Citron LLP, it's not necessarily the substance of the tweet that's problematic - it's the fact that Musk didn't clear it before he hit send. Tesla's stock rose by just $1.10, or less than 1 percent, the next day.

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The SEC motion filed this week could throw the electric vehicle maker into chaos at a time when it is under pressure to repay hundreds of millions of dollars in loans due in coming months.

In that interview, Musk revealed that no one at Tesla was screening the tweets he posts to his account, which now has 25 million followers. I do not respect the SEC.

Tesla's "disclosure counsel" realized Musk may have crossed a line with his February 19 tweet about auto manufacturing, according to the SEC.

Musk and Tesla also tried to defend the tweet by saying the SEC "forgot to read Tesla earnings transcript" - referring to the company's fourth-quarter earnings call - in which he told investors that Model 3 output would reach 500,000 "sometime between Q4 of 2019 and Q2 of 2020". 25, 2019 in NY resurrects a dispute between the Securities and Exchange Commission and Musk that was supposed to have been resolved with a settlement reached five months ago.

Now, Lutzker said, the SEC could seek to suspend Musk from serving as CEO of a public company.

Shares of Tesla down almost 0.4 percent at $297.44 in early afternoon trading, but recoverd from the lowest point of the day.

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