Elon Musk’s troubles with the U.S. Securities and Exchange Commission (SEC), America’s financial regulator, are well documented. From his infamous 2018 ‘funding secured’ tweet, to his Twitter poll last year on whether he should sell 10 percent of his ownership, the SEC has taken a dim view on Musk’s social media usage.
However, Musk’s legal team is hitting back, and they are not pulling their punches. To resolve the aforementioned ‘funding secured’ twitter scandal, Musk accepted a consent decree to have all future social media posts verified by a lawyer.
Additionally, according to Musk’s lawyer’s letter, both Musk and had to pay $20 million each to Tesla’s shareholders as a result of the fallout from the tweet.
This is the sticking point for Musk’s lawyer, Alex Spiro.
Spiro claims that the SEC, who were responsible for distributing the $40 million that was paid, have not done so. He claims that “the SEC has been in possession of funds owed to Tesla investors for more than 1,200 days, [and] it has yet to announce anything like a distribution plan.”
Fighting words, but Spiro was not done there.
“The SEC has broken its promises.” – Alex Spiro
Spiro claims that instead of moving past the resolution once the $40 million had been paid, the SEC “has chosen to spend its energy and resources investigating Mr. Musk’s and Tesla’s compliance with the consent decree.”
They had hoped agreeing to the settlement in 2018 would be enough to “end the SEC’s harassment.” However, Spiro claims that the SEC has instead tried “weaponizing the consent decree by using it to try to muzzle and harass Mr. Musk and Tesla.”
In slightly less formal terms, but with an equally serious allegation, Spiro claimed that “the SEC’s outsized efforts seem calculated to chill his [Musk’s] exercise of First Amendment rights.”
While the SEC has yet to reply publicly to these allegations, the court has ordered the financial regulator to respond to them by February 24.
