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In a document filed with the US District Court in Manhattan on Tuesday, the Securities and Exchange Commission claimed that Tesla and Elon Musk had “no valid substantive grounds” to challenge the subpoena issued by the authorities in November.
| Ticker | safety | last | Change | change % |
|---|---|---|---|---|
| TSLA | Tesla, Inc. | 993.98 | +72.82 | + 7.91% |
The subpoena is investigating Tesla’s “compliance governance process” under the 2018 settlement amended to resolve securities fraud claims, according to the 10-K filings.
A big win for Tesla’s Giga Berlin investors
Regulators alleged that they made “false misleading” statements about Tesla’s privatization plans when they tweeted that they had “secured” funds to keep electric car makers private for $ 420 per share. Then, after the regulatory authorities filed a proceeding against Musk, a settlement was reached. The proceedings also alleged that Musk was “reckless to know or did not know” that his remarks were false and / or misleading.
In addition to Tesla and Musk paying a $ 20 million fine each, the settlement requires Musk to scrutinize Tesla-related tweets with his legal counsel before sending them. Tesla also needed to add two new independent directors, and Musk was stripped of his chairman’s title. Under the terms of the settlement, Musk and Tesla did not admit or deny cheating.
The SEC is currently investigating whether Musk complies with pre-approval requirements before issuing a Twitter poll asking its followers if it should sell 10% of Tesla’s shares.
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In a motion filed in the U.S. District Court in Manhattan in February, Musk and Tesla agreed in 2018 to target him in a “relentless” investigation in an attempt to “cool the exercise of his first amendment.” I blamed the SEC for using it as a weapon.
In addition to Tesla and Musk paying a $ 20 million fine each, the settlement requires Musk to scrutinize Tesla-related tweets with his legal counsel before sending them. (Natan Dvir and Joshua Roberts / Bloomberg via Getty Images)
The SEC denies the accusations and calls them “flirty” and “unfounded.” Tesla and Musk argue that there is a “justified purpose” in investigating whether they maintain and comply with the proper disclosure controls and procedures required by federal securities law.
“As long as Mask and Tesla use Mask’s Twitter account to disclose information to investors, the SEC will control Tesla’s disclosure, including the accuracy of Mask’s tweets about Tesla and Tesla’s official statement about its management. And you can legally investigate issues related to the procedure. Procedure. ”
Musk also voluntarily agrees to comply with the tweet pre-approval policy when it first reaches a settlement, and the “high burden” required to revoke the subpoena and terminate or change the consent decree. I can’t handle it. ”
“Mask has determined that complying with Tesla’s procedures is more inconvenient than expected, or hopes that the SEC will not investigate whether Tesla’s disclosure controls and procedures are actually maintained and adhered to. The amended final judgment cannot be revoked just because it is. “Regulatory agencies say.
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Musk’s lawyer Alex Spiro argued that the SEC could not take any action related to Musk’s tweet without the court’s permission. He also emphasized that Musk signed the agreement when Tesla was a less mature company and the SEC’s actions were in a position to jeopardize the company’s financing.
Tesla CEO Elon Musk will tour the future foundry of the Tesla Gigafactory in Grünheide, near Berlin, Germany, on August 13, 2021. (PatrickPleul-Pool / Getty Images / Getty Images)
Spiro and Tesla did not immediately return FOX Business’s request for comment on Tuesday’s submission.