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Musk Trouble

SEC Threatens Elon Musk With Legal Action Over New Tweet

Musk lashed out in response: "Something is broken with SEC oversight."

Victor TangermannFebruary 26th 2019
News
Robert Daemmrich Photography Inc/Corbis via Getty Images

In Contempt

According to documents filed yesterday in the Southern District of New York, the Securities and Exchange Commission (SEC) is asking a federal judge to hold Tesla CEO Elon Musk in contempt for a recent tweet, The Verge reports.

The tweet in question: Last week, Musk said that Tesla was going to produce half a million cars in 2019. In a follow up posted roughly four and half hours later, Musk corrected himself, tweeting that he meant the “annualized production rate at the end of 2019” while total production is closer to 400,000 cars.

Troubled Past

The news comes after Musk was sued by the SEC in late September 2018 for tweeting that he planned to take Tesla private at $420 per share in August.

Tesla ended up settling with the SEC in October, agreeing that Musk would step down as Tesla chairman for at least three years and that his tweets would be monitored.

Broken

But that monitoring system seems to have faltered.

After SEC filed the documents yesterday, Musk followed up in a tweet: “SEC forgot to read Tesla earnings transcript, which clearly states 350k to 500k. How embarrassing…”

It’s not yet clear if Musk actually violated the agreement between Tesla and the SEC. The Verge suggested that Musk will likely be fined.

Musk’s opinion is clear on the matter. In a response on Twitter, he argued that Musk’s Feb. 19 tweet didn’t move markets. “This has now happened several times. Something is broken with SEC oversight.”

Shares of Tesla were down nearly 2.5 percent in premarket trading today, CNBC reports.

READ MORE: Elon Musk might be held in contempt of court over a Tesla tweet [The Verge]

More on Tesla: Report: In Fatal Crash, Door Handles Fail on Burning Tesla

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