Culture

The S.E.C. Wants To Remove Elon Musk As Head Of Tesla Over A Tweet He Recently Posted


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Elon Musk may be the latest person to learn that you should never tweet. The South African entrepreneur may be in legal trouble over a social media post, the latest skirmish in what’s been a weird year for the Tesla and SpaceX founder.

The Securities and Exchange Commission announced on Thursday that it’s suing Musk over a recent tweet where he claimed to have secured financing to take Tesla private. The SEC held a press conference where it charged Musk with fraud and announced it would seek to prevent him from serving as an executive or director of a publicly traded company. Tesla is, of course, a publicly-traded company.

The whole ordeal is, strangely enough, over a tweet Musk sent out in which he claimed he had “secured” funding to help take Tesla private, with him still in control of the company.

But according to the New York Times, the S.E.C. alleges that was a “reckless” attempt to mislead the public about the state of the company. Here’s the tweet in question, which was still up as of the S.E.C.’s New York filings on Thursday.

Musk reportedly sent that out while “driving” himself to the airport in a Tesla Model S. But Tesla’s board was apparently blindsided by that news, and the S.E.C. launched an investigation into the matter. The Times has more information about the suit, including the exact phrasing the S.E.C. uses to describe the tweet and its impact on public perception of Tesla as well as Musk’s response.

The S.E.C. said Mr. Musk “knew or was reckless in not knowing” that his statements were false or misleading. “In truth and in fact, Musk had not even discussed, much less confirmed, key deal terms, including price, with any potential funding source,” the S.E.C. said in its lawsuit.

In a statement distributed by Tesla, Mr. Musk said: “This unjustified action by the S.E.C. leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life and the facts will show I never compromised this in any way.”

Mr. Musk, who sometimes sleeps on Tesla’s factory floor as he works to iron out production problems, is widely regarded by analysts and investors as the creative engine behind Tesla. The company’s shares tumbled more than 10 percent in after-hours trading after the S.E.C. filed its lawsuit.

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