(Bloomberg) – Elon Musk, chief executive officer of Tesla Inc., told a judge that he should not be banned from speaking about his struggle with the US Securities and Exchange Commission, as suing shareholders have been demanding.
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It’s the latest salvo in a lawsuit from shareholders alleging Musk’s 2018 tweet about the company’s privatization manipulated the stock price and defrauded them. Last week, investors won a major verdict ahead of a January fraud trial in San Francisco that will have billions of dollars in damages at stake.
After Musk publicly complained at a TED Talk that he was “unlawfully” forced to settle a 2018 SEC lawsuit over the same tweet, investors said his comment threatened to “stain” the jury that would eventually decide will find out if the richest person in the world has committed fraud.
Read more: Musk’s disappointment with SEC angers investors suing over 2018 tweets
Shareholders asked U.S. District Judge Edward M. Chen to bar Musk from making any further public comments on his “interpretation and opinion” on the allegations in her lawsuit until after the trial is complete.
The investors “request this court to trample on Elon Musk’s First Amendment rights by preventing him from publicly discussing this case or the facts underlying it,” attorneys for Musk and Tesla said in Wednesday’s filing. This motion “cannot be reconciled with the constitutional guarantee of freedom of expression and should be rejected.”
The Tesla CEO said in the filing that the investors’ lawyers made no effort to show how his recent comments could possibly have reached the millions of potential jurors in the case. Musk also argued that the “gag order” demanded by shareholders would prevent him from communicating with Tesla shareholders or speaking publicly about his attempt to buy Twitter Inc.
The story goes on
Even in the most publicized cases, potential jurors remain unaffected by press coverage, Musk’s attorneys said. They cited murder indictments by Watergate and members of the Ku Klux Klan and the Nazi Party, as well as another involving Enron, to argue that even these cases did not justify restrictions on media or witness freedom of speech.
Musk insists that the August 2018 tweet in which he considered taking Tesla private with “secured funding” was true. But Chen, after reviewing the evidence, concluded it was wrong.
The case is In re Tesla Inc. Securities Litigation, 18-cv-04865, US District Court, Northern District of California (San Francisco).
(Updates with Musk’s arguments in court filing.)
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