The Securities and Exchange Commission argued in court this week that Tesla and its CEO Elon Musk should not be released from an agreement to monitor the executive’s Twitter behavior. The comments follow Musk’s attempts to challenge the SEC in court.
The commission said in a filing in the federal court in Manhattan that Musk had not met the “high burden” to call off a consent decree from 2018 requiring his tweets to be approved by Tesla when they relate to the company’s business.
“When it comes to civil settlements, a deal is a deal, absent far more compelling circumstances than are here presented,” the SEC said. It’s not enough that Musk has found compliance “less convenient than he had hoped.”
In addition, the SEC asked U.S. District Judge Alison Nathan, who oversees the decree, to reject the executive’s attempts to kill a subpoena requesting records related to his Twitter poll from last November in which he asked if he should sell 10 percent of his Tesla stock.
Musk has accused the SEC of harassing him, but the SEC argued that it has broad authority and a “legitimate purpose” to investigate him.
“Musk complains about ‘the sheer number of demands’ by the SEC from 2018 to the present, which he characterizes as harassment,” the SEC said. “But Musk’s own chronology of alleged demands is both underwhelming and reflects legitimate inquiries as to new potentially violative conduct by Tesla and Musk.”
Following the tweet in question, Tesla’s stock fell sharply. The SEC is also investigating Elon’s brother Kimball, who sold millions of dollars in shares a day before the tweet in question was sent.
Legal experts to whom Reuters spoke suggested that Musk is unlikely to have the deal set aside.