3-11-2023 (NEW YORK) Tesla CEO Elon Musk has filed objections with a federal judge, seeking to avoid testifying in the U.S. Securities and Exchange Commission’s (SEC) investigation into his $44 billion takeover of Twitter, which was formerly known as Twitter.
Musk lodged his objections in San Francisco federal court, where the SEC had sued him on October 5 to compel his testimony for the probe initiated in April 2022. According to Musk’s legal team, the SEC’s subpoena surpasses its investigative authority, imposes excessive burdens, and seeks irrelevant evidence.
The SEC’s investigation pertains to Musk’s 2022 purchases of Twitter stock, his statements, and SEC filings regarding Twitter, which he later renamed “X.” It’s worth noting that Musk declined to participate in a September interview as part of the probe.
Alex Spiro, one of Musk’s attorneys, has previously characterized the SEC’s investigation as “misguided.” In the recent filing, Spiro and Musk’s legal team assert that the SEC’s pursuit of Musk has evolved into harassment, crossing a line.
The SEC has stated that it is well within its authority to request further testimony from Musk, and it has claimed to have received new documents since its last interview with him.
On April 4, 2022, Musk disclosed that he had acquired a 9.2% stake in Twitter, which came 11 days after the SEC’s deadline for such disclosures. Initially, Musk stated his intention to be a passive stakeholder, indicating he had no plans to take over the company. However, later that month, he announced his intention to purchase Twitter for $44 billion. Subsequently, Musk attempted to back out of the deal, alleging that Twitter had not fully disclosed the extent of bot activity on its platform. Following legal action, Musk completed the acquisition of Twitter in late October 2022.
Musk has already provided the SEC with documents related to the investigation and gave testimony via video conference in July the previous year. The SEC has indicated that they have further questions for Musk in light of the documents provided.
The filing on Thursday described the SEC’s 18-month effort to investigate Musk over a supposedly untimely filing as the latest chapter in a more than five-year saga of the agency’s harassment against Musk and related entities.
This legal battle marks the latest development in the strained relationship between the U.S. market regulator and Elon Musk, the world’s wealthiest person.
In 2018, the SEC sued Musk for his social media posts claiming he had “funding secured” to take Tesla private. Musk settled but was sued again in 2019 for alleged violations of the agreement’s terms.
Musk has accused the agency of conducting “endless” investigations into him and Tesla. He has announced his intention to ask the U.S. Supreme Court to review the legality of his SEC settlement, which mandates that he consult with a Tesla attorney on some of his social media posts.
