Topline
Lawyers representing Elon Musk asked a federal court to block the U.S. Securities and Exchange Commission’s attempt to force him to testify in the regulator’s investigation into his $44 billion acquisition of the social media company formerly known as Twitter.
SpaceX, X (formerly known as Twitter), and Tesla CEO Elon Musk speaks with members of the media … [+]
Key Facts
In a filing with the Northern District of California federal court, Musk’s attorney referred to the SEC’s demands as “duplicative and harassing,” saying they have been made “under the guise of never-ending investigations” into his companies.
Musk’s lawyers accused the SEC of attempting to tarnish Musk with “baseless accusations,” claiming the eighteen-month-long investigation was prompted by “nothing more than allegedly days-late filings.”
The filing notes Musk received five subpoenas for documents and three seeking his testimony as part of the investigation.
Musk has provided the agency with testimony totaling nine hours across his first two summons, where he spoke on matters related to his acquisition of Twitter stock in 2022 and potentially joining the company’s board.
Musk’s attorneys accuse the SEC of wrongly claiming Musk agreed to provide a third testimony of the matter, saying his counsel did not “consent to a third testimony or concede that the Commission has the authority to compel it.”
The filing argues that the agency’s investigation into the matter should have ended a year ago, as it appeals to the court to deny the attempt to enforce the subpoena.
Crucial Quote
“This is just the latest chapter in a more-than-five-year saga of agency harassment against Mr. Musk and related entities. While the details may change, the story stays the same: bad faith investigations conducted by officials acting in clear violation of the Constitution. The SEC has proceeded in excess of its authority and contrary to law, and its Application should be denied,” the filing adds.
Chief Critic
“Musk’s ongoing refusal to comply with the SEC’s administrative subpoena is hindering and delaying the SEC staff’s investigation to determine whether violations of the federal securities laws have occurred,” the agency’s lawyers wrote in their filing with the court last month.
Key Background
Musk acquired Twitter for $44 billion last year and took the social media company private before re-branding it to X. The SEC is attempting to probe if the billionaire violated any securities laws in 2022 when he purchased a huge tranche of Twitter’s stock—focusing on the public statements and filings made after the purchase.
Big Number
$19 billion. That the amount X is reportedly worth today according to the company stock grants given to the company’s employees recently. This internal valuation is less than half of the $44 billion Musk paid to acquire the platform.
Further Reading
X Says It’s Worth Less Than Half What Elon Musk Paid (Forbes)
Elon Musk asks court to reject SEC’s bid to make him testify in Twitter probe (Reuters)
