Oct 5 (Reuters) – The U.S. Securities and Exchange Commission has filed a lawsuit against Elon Musk, the world’s richest man, in an attempt to force him to testify as part of an investigation into his $44 billion acquisition of social media giant Twitter. The court filing showed Thursday.
The investigation, which escalates a long-running dispute between the SEC and Musk, concerns whether Musk violated federal securities laws in 2022 when he bought shares in Twitter, which Musk renamed to X, as well as statements and filings made by the SEC. Securities and Exchange Commission in connection with the case. an agreement.
The Securities and Exchange Commission said in May 2022 that it was considering Musk’s disclosure of his stake in Twitter, questioning whether he had filed the appropriate paperwork.
The SEC said in a filing on Thursday that it had subpoenaed Musk in May 2023, asking him to testify at the SEC’s office in San Francisco, and that Musk had agreed to appear on September 15. But two days ago, Musk raised “numerous false objections” and told the SEC he would not appear.
Musk also rejected the SEC’s proposals to hold the filing in Texas in October or November.
Among his objections were that the SEC was trying to “harass” him and that his attorney needed time to review potentially relevant material contained in Musk’s autobiography published last month, the SEC said.
According to the filing, Musk has provided documents to the SEC related to the investigation, and had previously provided testimony in July of last year via video conference.
“The SEC has already taken Mr. Musk’s testimony multiple times in this misleading investigation — enough is enough,” said a statement from Alex Spiro, Musk’s lawyer.
In a press release, the SEC said it was seeking Musk’s “testimony for information not already in the SEC’s possession that is relevant to its legitimate and lawful investigation.” An SEC spokesman declined to comment further.
Musk acquired Twitter after initially building a significant minority stake in the social media platform, which he first disclosed in April 2022. Musk was late in making the disclosure and initially indicated that he planned to be a passive stakeholder, meaning he did not plan the acquisition. Twitter or influencing its management decisions.
Days later, Musk accepted and then declined a seat on Twitter’s board. In late April, he announced plans to buy the company for $44 billion, but later tried to exit the deal, claiming that Twitter had not disclosed the full extent of bot activity on its platform.
Facing a trial that sought to force him to complete the deal, Musk terminated his acquisition of Twitter in late October 2022.
Thursday’s filing is the latest spat between Musk and the SEC, which have been at loggerheads since Musk’s 2018 tweet in which he said he planned to take his electric car maker Tesla (TSLA.O) private and secured financing. Since then, Musk has repeatedly discredited the SEC, which has opened multiple investigations into him over the years.
“A comprehensive overhaul of these agencies is urgently needed, along with the establishment of a committee to take punitive action against those individuals who have abused their regulatory power for personal and political gain,” Musk said in a post on X.
Howard Fisher, a partner at the law firm Moses & Singer and a former SEC official, said Musk’s refusal to appear at the September testimony was unusual. “I’ve never heard of a senior executive holding positions at public companies who never showed up.”
The lawsuit filed on Thursday adds to Musk’s legal woes. Reuters previously reported that the Justice Department is investigating Tesla over self-driving claims. Federal prosecutors in New York have also opened an investigation into Musk’s company liens and claims related to the vehicle’s driving range, according to a report.
(Reporting by Shivansh Tiwari in Bengaluru; Reporting by Shivaansh Tiwari in Bengaluru) Tom Hulse in Wilmington, Delaware; Chris Prentice in New York; Michelle Price in Washington; Sheila Dang in Austin; Editing by Megan Davies, Shinjini Ganguly, and Lisa Shoemaker
Our standards: Thomson Reuters Trust Principles.
“Devoted student. Bacon advocate. Beer scholar. Troublemaker. Falls down a lot. Typical coffee enthusiast.”