Chief Twit Elon Musk has lost another bid to end a 2018 settlement with the US Securities and Exchange Commission (SEC) regarding his controversial “funding secured” tweets after a federal appeals court rejected his effort to modify his settlement with the SEC.
San Francisco, May 16,2023: Chief Twit Elon Musk has lost another bid to end a 2018 settlement with the US Securities and Exchange Commission (SEC) regarding his controversial “funding secured” tweets after a federal appeals court rejected his effort to modify his settlement with the SEC.
The 2nd US Circuit Court of Appeals in Manhattan rejected Musk’s argument that the consent decree reached in 2018 is a “prior restraint” on his speech.
“Each tweet plausibly violated the terms of the consent decree,” the Court of Appeals for the Second Circuit in New York City wrote in its ruling, reports The Verge.
Musk must continue to have certain Tesla-related tweets pre-approved by a lawyer.
The court said in its ruling that the SEC investigated three of his tweets: the infamous 2018 “funding secured” tweet that subsequently resulted in the consent decree, a $40 million fine and Musk losing the chairmanship of Tesla.
Two other Musk tweets had misleading information about Tesla’s vehicle production and a poll proposing Musk sell 10 per cent of his Tesla stock.
In February this year, another court in the US had cleared Musk in a class-action securities fraud over his tweets about taking Tesla private.
Musk had tweeted that he is “deeply appreciative of the jury’s unanimous finding”.
Musk had earlier admitted in a US court that he ignored his advisors and investors while tweeting about Tesla securing funding in 2018.
In August 2018, he had tweeted: “Am considering taking Tesla private at $420. Funding secured.”
“Shareholders could either sell at 420 or hold shares & go private,” he added.
The notorious tweet had cost him his role as Chairman of Tesla.
The August 2018 tweet resulted in Musk and Tesla reaching a settlement of fraud charges with the US SEC.
The settlement included $40 million in penalties, split equally between the company and Musk, and the removal of Musk as chairman of the Tesla board.
Tesla also agreed to pay a separate $20 million penalty.
Musk finally acquired Twitter for $44 billion in October 2022.