A U.S. judge has mandated that Elon Musk testify in an investigation conducted by the Securities and Exchange Commission (SEC) regarding his acquisition of Twitter in 2022.
Tesla and SpaceX CEO Elon Musk has been directed by a federal judge to testify in an investigation conducted by the U.S. Securities and Exchange Commission (SEC) regarding his acquisition of Twitter in 2022, according to an order dated February 10, 2024. The SEC is examining potential securities fraud related to Musk’s stock purchases in Twitter and the subsequent leveraged buyout of the social media platform.
The SEC’s probe revolves around potential securities fraud linked to Musk’s stock purchases in Twitter, particularly as he strategically amassed a stake before executing a leveraged buyout of the social media giant. The investigation aims to determine whether Musk, or any other party involved, engaged in fraudulent activities during the acquisition in 2022.
Musk completed the acquisition of Twitter in October 2022 for approximately $44 billion, subsequently rebranding it as X. Despite Musk and his legal team arguing that the SEC’s subpoena amounted to harassment, the judge, Laurel Beeler, affirmed the SEC’s authority, stating that the subpoena was clear and sought relevant information for the investigation.
The order sets the stage for a testimony from Musk, who, along with his legal team, now has one week to collaborate with the SEC in determining the date and location of the testimony. As of now, neither Musk nor his attorney, Alex Spiro, nor the SEC has provided immediate comments on the judge’s directive.
The SEC and Musk are now given one week to collaborate on setting a date and location for Musk’s testimony. Musk, his attorney Alex Spiro, and the SEC have not provided immediate responses to requests for comments.
Notably, Musk has a history of challenging federal regulatory agencies’ authority. He has previously sought to overturn a settlement agreement with the SEC, which mandated pre-approval of his tweets about Tesla by a “Twitter sitter.” Musk’s legal team argued that the agreement violated his free speech rights.
Elon Musk, a high-profile entrepreneur known for his involvement in groundbreaking ventures such as Tesla and SpaceX, has a history of challenging regulatory authorities. Previously, he has sought intervention from the U.S. Supreme Court to annul settlement agreements with the SEC. One such agreement required Musk to obtain approval for his tweets about Tesla from a designated “Twitter sitter” to ensure compliance.
In a separate instance, Musk-led SpaceX filed a lawsuit against the National Labor Relations Board (NLRB) after the agency filed a complaint accusing the company of unlawfully terminating employees who criticized Musk in an open letter. SpaceX’s lawsuit, filed in the U.S. District Court for the Southern District of Texas in Brownsville, claims that the structure of the federal labor board violates the U.S. Constitution and aims to prevent the NLRB’s complaint from proceeding, echoing a similar case brought by a former Starbucks employee against the NLRB.
This latest development adds another layer to Musk’s interactions with regulatory bodies, showcasing the ongoing tension between his unconventional approach and the regulatory frameworks in place. The testimony, once scheduled, will likely be closely watched as it unfolds, providing insights into the intricacies of Musk’s actions during the Twitter acquisition and the subsequent SEC investigation.