NEW YORK (CBSNewYork) – Elon Musk, the new owner of Twitter, must still have his posts about his electric car firm Tesla pre-approved after a US judge denied a request to free him from control on Wednesday.
Musk filed a motion last month to lift SEC limits imposed after a 2018 tweet in which he claimed to have secured funds to take Tesla private but failed to produce proof or file paperwork with the securities regulator.
The post, which prompted wildly fluctuating stock prices, was judged “false and deceptive,” and Tesla shareholders have accused the company of securities fraud.
After another embarrassing remark in early 2019, the SEC charged Musk with fraud and ordered him to resign as chair of Tesla’s board of directors, pay a $20 million fine, and have all of his tweets directly linked to the company’s operations pre-approved by a qualified lawyer.
Musk claims that he was forced to accept the deal and that he lied to shareholders.
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Judge Lewis Liman noted in his finding that “Musk’s allegation that he was the subject of economic hardship is wholly unpersuasive.”
Musk’s claim that the SEC has exploited the agreement “to harass him” and investigate his speech is “meritless” and “especially ironic,” according to the judge, because his free speech rights forbid him from making comments that are “considered false” or “deceptive.”
“Musk cannot now seek to rescind the deal he consciously and deliberately accepted by simply lamenting that he felt compelled to agree to it at the time but now wishes he hadn’t now the threat of lawsuit has passed and his company has become, in his judgement, all but indestructible.”
Musk’s bid to quash part of the SEC’s demand for documentation about his November 6, 2021 tweet asking followers to vote on whether he should sell 10% of his Tesla stock was also denied by the judge.
The company’s stock price dropped as a result of the tweet, and the SEC wants to know if it was approved as needed. Musk’s brother, a Tesla board member, sold $108 million in the carmaker’s stock a day before the vote, prompting the FTC to look into alleged insider trading.
