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Elon Musk never sought approval for a single Tesla tweet, U.S. SEC tells judge

23 points by mikedh 8y ago

glvn 8y ago
I don't think anyone expected Musk to follow that directive. His comments after the initial rulling signaled he didn't really care for the SEC telling him what to do, followed by a tweet about "memes" that IMO was to just troll anyone watching his Twitter account.
- danso 8y ago
  I don't know, I think a lot of people expected him to follow that directive because it shouldn't have been hard to follow, especially relative to how easy it would be to find out if he didn't follow it. There is no point in breaking that rule.
- ivraatiems 8y ago
  The court almost certainly expects him to follow that directive. Provided that it is persuaded he didn't, he could be in some nasty trouble. In fairness, no reasonable person would predict that Musk would follow it. I imagine that played a role in the SEC's decision to request it. (What trap is better than one the victim agrees to enter of their own accord, in public?) Musk, not being a terribly reasonable person in this area, probably assumed it wouldn't be an issue for him. If so, that assumption may bite him.
danso 8y ago
The SEC complaint can be found here: https://www.documentcloud.org/documents/5775155-Reply-to-Response-to-Motion.html https://www.documentcloud.org/documents/5775155-Reply-to-Res...
fillskills 8y ago
What is really sad about the state of affairs is that SEC is suing Musk out of spite (seemingly) and not bothered by a President whose tweets are changing fortunes of multiple corporations. For reference SEC's mission statement: "The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation."
- cbanek 8y ago
  Well I think the difference is insider knowledge. If you run a public company, and know everything that is happening, that can give you a significant advantage in trading that stock. While I agree what the President is saying can move markets, and does, it's usually not because he knows something that everyone else doesn't (non-public information). It's just that his opinion moves markets. You could say the same for short sellers, who make detailed reports and release them publicly on why they believe certain companies stock will go down. This also affects the stock price, but doesn't have any non-public information. Now if the President was shorting all the pharmaceutical industry, then said something like "we're going to socialize healthcare", I feel like this is a bit different because it's almost like the regulator is using their information for gain. Same for congress, although funny enough, this hasn't been technically illegal for long: https://en.wikipedia.org/wiki/STOCK_Act https://en.wikipedia.org/wiki/STOCK_Act
- danso 8y ago
  The SEC doesn’t have authority over the president. Your complaint makes absolutely no sense.
- dosy 8y ago
  Right. Does anyone have any idea why the SEC has such a huge justice-hunger for Musk? Musk definitely gets a lot of government contracts and money, and is very connected to defence, and lobbying. Why is someone that useful / influential becoming a target of such intense focus and interest? Is it a personal grudge at the SEC (why?) or from above? Is it a way to laterally apply pressure on Musk regarding SpaceX?
  - londons_explore 8y ago
    My guess is some of the short sellers have friends who work at the SEC. That and Musk runs his company like a child, which allows it to be nimble, but also means every action doesn't get as much scrutiny as they expect.
    - bjl 8y ago
craftinator 8y ago
Regulate until everyone worth regulating goes elsewhere.
de_watcher 8y ago
From the point of view of the worldwide public, suing over twitter posts looks ridiculously funny. So better that than something else. That will train Musk a bit for later.
dec0dedab0de 8y ago
I'm having a hard time understanding this. Whats is the point of being CEO if you need approval to speak? Anyone investing in Tesla these days are basically investing in Musk. If they dont like the way he runs the business they can sell, or they can vote him out.
- deleted 8y ago
  [deleted]
- forgottenpass 8y ago
  >Whats is the point of being CEO if you need approval to speak? Oh, if I had to guess, the money and control are probably nice even if you structured your company in a way where you have to follow securities law.
- LiquidSky 8y ago
  The tweet approval is a requirement of the settlement Musk signed with the SEC for his previous instance of securities fraud. CEOs aren’t kings, they have laws to follow. Musk could have avoided all of this by simply not engaging in the behavior that earned him this forced oversight.
crb002 8y ago
SEC is asking for a First Amendment smackdown.

23 points by mikedh 8y ago

glvn 8y ago

I don't think anyone expected Musk to follow that directive. His comments after the initial rulling signaled he didn't really care for the SEC telling him what to do, followed by a tweet about "memes" that IMO was to just troll anyone watching his Twitter account.

danso 8y ago
I don't know, I think a lot of people expected him to follow that directive because it shouldn't have been hard to follow, especially relative to how easy it would be to find out if he didn't follow it. There is no point in breaking that rule.
ivraatiems 8y ago
The court almost certainly expects him to follow that directive. Provided that it is persuaded he didn't, he could be in some nasty trouble. In fairness, no reasonable person would predict that Musk would follow it. I imagine that played a role in the SEC's decision to request it. (What trap is better than one the victim agrees to enter of their own accord, in public?) Musk, not being a terribly reasonable person in this area, probably assumed it wouldn't be an issue for him. If so, that assumption may bite him.

danso 8y ago

The SEC complaint can be found here: https://www.documentcloud.org/documents/5775155-Reply-to-Response-to-Motion.html https://www.documentcloud.org/documents/5775155-Reply-to-Res...

fillskills 8y ago

What is really sad about the state of affairs is that SEC is suing Musk out of spite (seemingly) and not bothered by a President whose tweets are changing fortunes of multiple corporations. For reference SEC's mission statement: "The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation."

cbanek 8y ago
Well I think the difference is insider knowledge. If you run a public company, and know everything that is happening, that can give you a significant advantage in trading that stock. While I agree what the President is saying can move markets, and does, it's usually not because he knows something that everyone else doesn't (non-public information). It's just that his opinion moves markets. You could say the same for short sellers, who make detailed reports and release them publicly on why they believe certain companies stock will go down. This also affects the stock price, but doesn't have any non-public information. Now if the President was shorting all the pharmaceutical industry, then said something like "we're going to socialize healthcare", I feel like this is a bit different because it's almost like the regulator is using their information for gain. Same for congress, although funny enough, this hasn't been technically illegal for long: https://en.wikipedia.org/wiki/STOCK_Act https://en.wikipedia.org/wiki/STOCK_Act
danso 8y ago
The SEC doesn’t have authority over the president. Your complaint makes absolutely no sense.
dosy 8y ago
Right. Does anyone have any idea why the SEC has such a huge justice-hunger for Musk? Musk definitely gets a lot of government contracts and money, and is very connected to defence, and lobbying. Why is someone that useful / influential becoming a target of such intense focus and interest? Is it a personal grudge at the SEC (why?) or from above? Is it a way to laterally apply pressure on Musk regarding SpaceX?
- londons_explore 8y ago
  My guess is some of the short sellers have friends who work at the SEC. That and Musk runs his company like a child, which allows it to be nimble, but also means every action doesn't get as much scrutiny as they expect.
  - bjl 8y ago

craftinator 8y ago

Regulate until everyone worth regulating goes elsewhere.

de_watcher 8y ago

From the point of view of the worldwide public, suing over twitter posts looks ridiculously funny. So better that than something else. That will train Musk a bit for later.

dec0dedab0de 8y ago

I'm having a hard time understanding this. Whats is the point of being CEO if you need approval to speak? Anyone investing in Tesla these days are basically investing in Musk. If they dont like the way he runs the business they can sell, or they can vote him out.

deleted 8y ago
[deleted]
forgottenpass 8y ago
>Whats is the point of being CEO if you need approval to speak? Oh, if I had to guess, the money and control are probably nice even if you structured your company in a way where you have to follow securities law.
LiquidSky 8y ago
The tweet approval is a requirement of the settlement Musk signed with the SEC for his previous instance of securities fraud. CEOs aren’t kings, they have laws to follow. Musk could have avoided all of this by simply not engaging in the behavior that earned him this forced oversight.

crb002 8y ago

SEC is asking for a First Amendment smackdown.