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Musk Faces U.S. Contempt Claim for Violating Accord with SEC
- w8vY7ER 8y agoWas curious what their take was but had to bail on the site- what a horrible experience even with uBlock
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- toomuchtodo 8y agoEarlier thread: https://news.ycombinator.com/item?id=19250552 https://news.ycombinator.com/item?id=19250552
- frontloadpro 8y agoI got a feeling we are going to find out Elon does a lot of lying.
- ams6110 8y agoI'd say he does a lot of bullshitting. That's pretty typical for any CEO type person.
- tzakrajs 8y agoDo you think Elon truly believed that full self driving capability would ever be enabled for the people who shelled out for the newer versions of the car (the one that added shitty cameras all around)? He knows it can’t be done safely without high FPS lidar and/or more compute on board. He doesn’t care. He’s pulling a Theranos.
- rchaud 8y agoMost CEOs bullshit by talking in broadly general terms so as not to get pinned down on any particular issue. Musk seems to make stuff up on a whim just to see what the Twitter feedback would be. Shocking to think that this is coming from a nearly 50-year old man.
- dylan604 8y ago>Shocking to think that this is coming from a nearly 50-year old man. Is it though? Personality types are not something that changes with age. Maybe it gets toned down or more mellow with age, or it could get more extreme as they become more comfortable/confident in doing what ever trait it is. Pre-social, it might have only been notice by those in direct contact with an individual. Now, it's made visible to the entire online world. Musk is still younger than Trump, and he's not slowing down at his age either.
- thinkloop 8y agoThis one feels a bit witch-hunty, the "500k" number he tweeted wasn't meant to be some new accurate prediction, but a reiteration of their public position, to make a general point about how quickly they've grown over the years.
- spenczar5 8y agoOne of the burdens for securities fraud is "materiality" - whether a "reasonable investor" would have viewed the relevant information "as having significantly altered the total mix of information made available." Analysts were generally projecting 400k cars delivered. Musk, the CEO, the ultimate insider, suddenly reveals that Tesla will sell 25% more cars than people outside expected. I think it's fair to say that if that came as a press release from the company, the mix of information certainly would have changed and people would buy the stock. The SEC agreement was that he would pre-clear any material tweets with a lawyer. He said in a TV interview that he wouldn't get his tweets pre-cleared, and said "I want to be clear. I do not respect the SEC. I do not respect them.” And then he tweeted material information on Tesla. I think it's pretty fair to call that contempt of court!
- extrapickles 8y agoSo you can be in contempt now if you don’t match what analysts are saying? The definition of materiality you provided clears him as the numbers Musk tweeted are in the their quarterly report, so nothing new was learned.
- spenczar5 8y ago> So you can be in contempt now if you don’t match what analysts are saying? "Materiality" is weird, I agree! Matt Levine has a running line that "everything is securities fraud" these days. To be clear, he is in contempt of the court order around materiality. In general, not matching what analysts say isn't contempt of court, of course. > The definition of materiality you provided clears him as the numbers Musk tweeted are in the their quarterly report, so nothing new was learned. I do not agree. The quarterly report says "our goal is to be able to produce 10,000 vehicles per week on a sustained basis. Barring unexpected challenges with Gigafactory Shanghai, we are targeting annualized Model 3 output in excess of 500,000 units sometime between Q4 of 2019 and Q2 of 2020." The tweet said "“Tesla made 0 cars in 2011, but will make around 500k in 2019.” Those are very, very different statements! Musk's tweet indicates dramatically higher production at the end of 2019.
- dalbasal 8y agoIn fairness, musk is obviously contemptful of the sec, and public market norms/institutions generally. He should probably find a way to exit as Tesla ceo, imo. Being a public company CEO doesn't suit him. He built a car company from a cold start, made good cars, and pushed EVs forward by a good many years. We're now at the point where most major manufacturers make EVs. People are willing to buy them. Range is getting sufficient. Plans to start banning ICE cars next decade are getting serious. Job done, and done well. Get a CEO that does platitudes to run Tesla. Go do spaceX, boring companies, hyperloop... plenty of stuff to do. Plenty of money. Plenty of private investors willing to fund muskco projects. This Elon Musk Vs the stock market stuff is not going to be fun for anyone.
- gpm 8y agoI agree with everything except the implication of this (so overall good comment!) > In fairness, musk is obviously contemptful of the sec Being contemptful of the sec (or even the justice system) isn't a crime, despite the name "contempt of court" means "disobeying a court order" not "being contemptful". Thought crime isn't a thing.
- empath75 8y agoIt goes toward state of mind and that matters for crimes. If he gave every indication that he agreed with the settlement and was trying to comply, this could be seen as an accidental oversight. But given his statements on the sec, it’s hard to read this as anything other than an intentional violation.
- chipgap98 8y ago> In fairness, musk is obviously contemptful of the sec I'm 99% sure that this is a joke and the original commenter doesn't think having contempt for the SEC is a crime
- dalbasal 8y agoI know, but I also think there's a deep-ish meaning that is literal. Contempt of court is, historically and functionally, about contempt... which breeds disobedience. Respect has its own implications.. including obedience, in certain contexts. Also, I was just writing it because it sounded good att.
- reportperezh 8y agoPerez Hilton, celebrity Blogger is a known hacker in the hacker group Anonymous! His hacker name is AnonyForecast! You can see Perez Hilton as AnonyForecast in the documentary The Hacker Wars! Perez Hilton has a sister with her own persona! Her name is Ginger Voight! She is comedian Hal Sparks number one fan! Watch for Perez and Ginger in the Hal Sparks radio program chat room!
- cronix 8y agoSeek counseling for your twitter addiction. Delete it. You don't need it. You will be better for it in every way, Mr. Musk.
- rchaud 8y agoYour comment is slowly graying out, but this is the simplest and most obvious solution. Of course, once Twitter is eliminated I think we'll discover that it was the symptom and not the cause.
- mrguyorama 8y agoNarcissism is a hell of a drug
- dylan604 8y agoI feel that way about all social media, not just isolating Twitter. Social seemed to make narcissism accepted as the norm, and encouraged it.
- gpm 8y agoI think you vastly underestimate the amount of value Musk's twitter account produces for him. Tesla is in the business of selling luxury products. They live or die by people wanting to buy them. Musk's twitter account appears to be one of the primary marketing channels. SpaceX is in the business of - Getting regulatory approvals - Acquiring engineering talent cheep. - Selling things to taxpayers and rich people They live or die by politicians and potential hires liking them - billionaires who want a trip to the moon help too. Like with Tesla Musk's twitter account is one of the primary marketing channels. Don't think he's the only one doing this, here is Tory Bruno (ULA CEO)'s reddit account: https://www.reddit.com/user/ToryBruno/comments/ https://www.reddit.com/user/ToryBruno/comments/
- cronix 8y agoI've also listened to him in numerous interviews basically stating he is addicted to it. He's tried to control it in various ways. He can't. I'm not blaming him or saying he's weak, just that he himself realizes he has a problem and should take the next logical step since self-censoring doesn't seem to work for him. The stakes are pretty high for not complying. I understand your points. I don't think any of his companies would suffer if he wasn't the one making announcements. Stop talking about production. Hype all of the cool revolutionary tech you create all you want - just don't attribute it or mention the business side of things, especially when they are speculative. State facts, after they are facts..."we said it would be x production for 2019, and well, here we are at the end of the year we blew that away!!" or something factual. If he doesn't get a handle on it, he will lose it. That won't be good for anyone, except for competitors. I don't think Elon's use of Twitter is as useful of a tool for him in 2019 compared to when he started. There is plenty of buzz about his companies. I have tremendous respect for him. I absolutely don't want to see him fail, or see it fail because of something trivial like not being able to stop yourself from tweeting certain things that are off limits. There's too much on the line.
- reportperezh 8y agoAnonymous hacker Perez Hilton! Celebrity Blogger Perez Hilton hacker name is AnonyForecast
- kadendogthing 8y agoWhat generally happens moving forward? Let's assume he's "guilty" across the board. So two instances of misleading the market, along with violating a settlement. Is there a fine? For him and the company? Does he get removed from the board? I don't think jail is likely but, maybe?
- xkjkls 8y agoIt will depend on the judge and circumstances, but given that Elon didn't seem to be fazed by a $20 million fine last time, I could easily see a much larger fine this time.
- rootusrootus 8y agoWell, people have been jailed for less. My personal guess is they will try to disqualify him from being an officer of a public company.
- kodablah 8y agoI guess the critical question will be: "If a public earnings report lists a number range, then a tweet mentions a possible number within that range (using 'may'), is that 'material information to investors'"? I can see arguments to both sides. If anything though in the modern world of social media and the public's thirst for transparency, these kinds of stories can be seen as just an additional thing to think about before going public (obviously a very minor thing of course when making the decision, but still notable).
- xkjkls 8y agoYes. Re-iterating guidance is still material. Elon currently has a full month more of non-public information about Tesla's current demand and production. For him to publicly say "this number is still true" even if it is already public, is a material event.
- tempworker9000 8y ago>s that 'material information to investors'"? The guy went onto national television, implied he would not follow the court order, said he does not respect the SEC, then went ahead and broke the order. How is this even debatable? And let's not pretend that Tesla isn't already under scrutiny for absurd forecasts (under the guise of uncertainty) that they do not reach.
- smallgovt 8y agoI don't see how he can reasonably defend himself in this situation. His tweet was both material and inaccurate. Tweeting material information without clearance is obviously against his settlement. Yet, if TSLA's price signals anything, it'd be that he's in no danger.
- polishTar 8y ago> Yet, if TSLA's price signals anything, it'd be that he's in no danger. Or Tesla is in no danger. Musk still might be.
- kgwgk 8y agoMatt Levine: https://www.bloomberg.com/opinion/articles/2019-02-26/elon-musk-keeps-tweeting https://www.bloomberg.com/opinion/articles/2019-02-26/elon-m... "You can’t put Elon Musk in jail; he has a whole company for drilling tunnels! Let’s be fair to Musk: On the one hand, absolutely, he has been going around saying that he does not respect the law and is going to ignore the SEC and a court order, but on the other hand he has also been going around saying that he’s got a big drill. Also rocket ships, submarines, flamethrowers, possibly flying cars, basically the whole arsenal of supervillain technology. The message is not just “I do not care about the law”; it is also “and you can’t stop me bwahahaha.”
- Gpetrium 8y agoIt seems that the more a high-profile individual spends time in social media like Musk the higher the odds of making a misstep. Shareholders may want to keep a closer eye on highly 'media' active CEOs.
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- Tomminn 8y agoThis is a partial transcript of the Q4 2018 earnings call. There is a strong case to be made that the information was not market moving. Operator Thank you. Our next question is from Colin Rusch with Oppenheimer. Colin Rusch Thanks so much. Can you talk a little bit about the geographic dispersion for the guidance for 2019, where you're expecting the Model 3s to sell through as well as the other models? Elon Musk Well, I think we did, actually. Yes, it's clear in our letter. Deepak Ahuja We indicated in Q1, we will start delivering Model 3s in Europe and China. And we also shared a chart showing the potential market size for midsized premium sedans in North America, Europe and Asia, suggesting those markets could be even bigger. So I think that gives a good sense of where we'll be. And we'll launch the right-hand drive version at some point to go to the other markets. Elon Musk Yes. Maybe in the order of 350,000 to 500,000 Model 3s, something like that this year.