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So he violated his agreement with the SEC again? Specifically he didn't get his statement pre-approved by Tesla's lawyers to assure accuracy (since it is factua

So he violated his agreement with the SEC again? Specifically he didn't get his statement pre-approved by Tesla's lawyers to assure accuracy (since it is factually inaccurate). In fact this exact type of tweet is listed by expressly in the updated agreement[0]. [0] https://www.nytimes.com/2019/04/26/business/elon-musk-tesla-sec.html https://www.nytimes.com/2019/04/26/business/elon-musk-tesla-...

awrence 7y ago
If the SEC's new standard is to reprimand every CEO that makes a forecast the company ends up coming short on they're gonna get pretty busy pretty quick...
- Someone1234 7y ago
  It isn't. It is a settlement agreement that Musk personally and Tesla agreed to in order to avoid additional fines and penalties from his previous misconduct.
  - awrence 7y ago
    Yeah certainly seems as far as that whole thing is concerned no one cares to check / reinforce on the SEC side :) not that we can know for sure tbh. Bit of a super grey area all this imho. But like, if you're a potential TSLA investor and you can't be bothered to do two minutes of homework to figure out Musk's communcation "style", i don't know, like, should the SEC protect you? Maybe? Maybe not... And all things considered, there are plenty of CEO's doing worse by their shareholders than Elon so far...
    - Someone1234 7y ago
      So you're saying that Musk, Tesla's CEO, should be able to mislead investors unabated and that "buyer beware" is the solution rather than the SEC doing its job? I don't understand that argument. Ultimately Tesla and Musk agreed with the SEC that his previous conduct was wrong, and that's how we got to this settlement agreement. So to argue now that the SEC is wrong and that Musk's behavior is fine because that's his "style" seems to fly in the face of Tesla's own viewpoint on historical events vis-a-vis misleading tweets.
      - awrence 7y ago
        Well a couple things. First as another commenter pointed out i believe correctly, this tweet was sent before that aggreement was finalized so your point is moot technically. But let's assume for the sake of market integrity CEOs shouldn't lie. (doesn't stop politicians from getting elected or prosecuted but i'll leave that aside :). This was not as you seem to claim a lie. This was a forecast which cannot be proven before hand to be false or not. The exact tweet was: TESLA made 0 cars in 2011, but will make around 500k in 2019. Followed by a clarification that same day that he meant an annualized rate of around 500k. You can't factually prove this was wrong the day it was made. As it turns out it seems to me he got damn close and it was totally a legit forecast and not excessively bold but obviously you're welcome to have a different view.
  - marvin 7y ago
    There was a lot of drama when Musk made this tweet, and we don't know what sort of discussions or agreements have been made behind closed doors. Musk hasn't made similar tweets since then, so it seems plausible that SEC did indeed give some sort of warning, or that the parties have had some sort of clarifying exchange regarding their agreement.
    - gpm 7y ago
      The SEC publicly sued over this tweet, and basically lost. All they got out of it was the new agreement that makes the previous agreement clearer. Not the sort of punishment they were asking for. This is all a matter of public record, it was not handled behind closed doors.
      - marvin 7y ago
        Thanks for the info, I wasn't aware of the lawsuit and its conclusion. That definitely settles the initial point.
- aguyfromnb 7y ago
  >CEO that makes a forecast the company ends up coming short on they're gonna get pretty busy pretty quick... Would you be shocked to learn that when a company realizes they are going to to materially miss a forecast they are obligated to notify shareholders? This is how it works. You know, the exact opposite of Elon saying "profits from here on out" then losing $700MM the very next quarter.
- FireBeyond 7y ago
  There's a difference between "objective forecasting" and "hype". One should always be acceptable, the other should have some limitations or basis in reality.
awrence 7y ago
That aside, 112k reported Q4. That's pretty damn close to 500k annualized.
- Someone1234 7y ago
  He didn't say it was "annualized." Therefore he made a factual reporting error, which means the statement likely wasn't pre-approved, and therefore directly violated the SEC agreement (both versions). A follow up tweet doesn't allow him to bypass the pre-approval process he agreed to in the settlement.
  - gpm 7y ago
    You don't need to be inferring the statement wasn't pre-approved. Musk has stated as much in court documents. Where you are wrong is your claim that it needed pre-approval under the first agreement. Only statements that Musk, in his own opinion, believed contained material facts need pre approval. Gloss on publicly known figures is not material, that is what Musk thought he was posting, therefore it did not need per-approval. The SEC tried and failed to push the argument you are trying to push in court. You can view the complete docket here. https://www.courtlistener.com/docket/7946295/united-states-securities-and-exchange-commission-v-musk/ https://www.courtlistener.com/docket/7946295/united-states-s... You can find musk making the admission I claim he made above in this court filing. You can also find a better version of the argument I made about the tweet not needing pre-approval. https://www.courtlistener.com/recap/gov.uscourts.nysd.501755/gov.uscourts.nysd.501755.27.0_1.pdf https://www.courtlistener.com/recap/gov.uscourts.nysd.501755...
    - marvin 7y ago
      Thanks for the links, nice to see this clearly described. The journalists were much happier to write about a prospective scandal than about the fact that it didn't happen, so even as a not-quite-casual observer, it hasn't been so easy to pick up the details on this.
- kevinventullo 7y ago
  And according to https://www.statista.com/chart/13435/tesla-vehicle-production/ https://www.statista.com/chart/13435/tesla-vehicle-productio... this compares to 86k in Q4 2018, and ~25k in Q4 2017. As a long term investor, is the exact number all that important compared to the general shape of the curve? (N.b. I have no position in $TSLA)
gpm 7y ago
Get your dates straight. That tweet is before both that article and that updated agreement.
- Someone1234 7y ago
  > Nor does that agreement ban such tweets, it only requires that they are run by lawyers first. But it wasn't run by the lawyers because it contains a factual reporting error the lawyers would have flagged. Thus he violated the SEC agreement. Nobody said the tweet was banned. The tweet violated the agreement because it likely wasn't pre-approved (or his lawyers are really really bad).
  - gpm 7y ago
    Sorry, I removed that and the next part of my post about 20 seconds after posting it exactly to avoid getting into pointless fights like this. We had bad luck with your refresh time... But, you are still messing up your dates. He did not violate the agreement because the original agreement was in effect at the time and it did not require running this past his lawyers. This has run out through court already, the SEC did not win.
    - aguyfromnb 7y ago
      >the SEC did not win. What do you mean? Tesla and Elon settled fraud charges: https://www.sec.gov/news/press-release/2018-226 https://www.sec.gov/news/press-release/2018-226 Stop the gaslighting.
      - gpm 7y ago
        The sec sued asking for punishment for violating the agreement. The judge basically said, ya, no, but why don't you guys write up a new one that everyone agrees on the meaning of. And that is what happened. A settlement where you get literally nothing that you asked for is a loss not a win. Edit: I just realized you linked to the wrong settlement. One sec, I'll find the right one for you. It seems that the SEC didn't release any press releases over their loss (shocking, I know) - but here is an article: https://www.bloomberg.com/news/articles/2019-04-26/musk-sec-settle-legal-fight-over-his-tweets-about-tesla-juykzbwq https://www.bloomberg.com/news/articles/2019-04-26/musk-sec-... - you could also refer to the original article you posted in your original incorrect claim that Musk violated the updated agreement.

awrence 7y ago

If the SEC's new standard is to reprimand every CEO that makes a forecast the company ends up coming short on they're gonna get pretty busy pretty quick...

Someone1234 7y ago
It isn't. It is a settlement agreement that Musk personally and Tesla agreed to in order to avoid additional fines and penalties from his previous misconduct.
- awrence 7y ago
  Yeah certainly seems as far as that whole thing is concerned no one cares to check / reinforce on the SEC side :) not that we can know for sure tbh. Bit of a super grey area all this imho. But like, if you're a potential TSLA investor and you can't be bothered to do two minutes of homework to figure out Musk's communcation "style", i don't know, like, should the SEC protect you? Maybe? Maybe not... And all things considered, there are plenty of CEO's doing worse by their shareholders than Elon so far...
  - Someone1234 7y ago
    So you're saying that Musk, Tesla's CEO, should be able to mislead investors unabated and that "buyer beware" is the solution rather than the SEC doing its job? I don't understand that argument. Ultimately Tesla and Musk agreed with the SEC that his previous conduct was wrong, and that's how we got to this settlement agreement. So to argue now that the SEC is wrong and that Musk's behavior is fine because that's his "style" seems to fly in the face of Tesla's own viewpoint on historical events vis-a-vis misleading tweets.
    - awrence 7y ago
      Well a couple things. First as another commenter pointed out i believe correctly, this tweet was sent before that aggreement was finalized so your point is moot technically. But let's assume for the sake of market integrity CEOs shouldn't lie. (doesn't stop politicians from getting elected or prosecuted but i'll leave that aside :). This was not as you seem to claim a lie. This was a forecast which cannot be proven before hand to be false or not. The exact tweet was: TESLA made 0 cars in 2011, but will make around 500k in 2019. Followed by a clarification that same day that he meant an annualized rate of around 500k. You can't factually prove this was wrong the day it was made. As it turns out it seems to me he got damn close and it was totally a legit forecast and not excessively bold but obviously you're welcome to have a different view.
- marvin 7y ago
  There was a lot of drama when Musk made this tweet, and we don't know what sort of discussions or agreements have been made behind closed doors. Musk hasn't made similar tweets since then, so it seems plausible that SEC did indeed give some sort of warning, or that the parties have had some sort of clarifying exchange regarding their agreement.
  - gpm 7y ago
    The SEC publicly sued over this tweet, and basically lost. All they got out of it was the new agreement that makes the previous agreement clearer. Not the sort of punishment they were asking for. This is all a matter of public record, it was not handled behind closed doors.
    - marvin 7y ago
      Thanks for the info, I wasn't aware of the lawsuit and its conclusion. That definitely settles the initial point.
aguyfromnb 7y ago
>CEO that makes a forecast the company ends up coming short on they're gonna get pretty busy pretty quick... Would you be shocked to learn that when a company realizes they are going to to materially miss a forecast they are obligated to notify shareholders? This is how it works. You know, the exact opposite of Elon saying "profits from here on out" then losing $700MM the very next quarter.
FireBeyond 7y ago
There's a difference between "objective forecasting" and "hype". One should always be acceptable, the other should have some limitations or basis in reality.

awrence 7y ago

That aside, 112k reported Q4. That's pretty damn close to 500k annualized.

Someone1234 7y ago
He didn't say it was "annualized." Therefore he made a factual reporting error, which means the statement likely wasn't pre-approved, and therefore directly violated the SEC agreement (both versions). A follow up tweet doesn't allow him to bypass the pre-approval process he agreed to in the settlement.
- gpm 7y ago
  You don't need to be inferring the statement wasn't pre-approved. Musk has stated as much in court documents. Where you are wrong is your claim that it needed pre-approval under the first agreement. Only statements that Musk, in his own opinion, believed contained material facts need pre approval. Gloss on publicly known figures is not material, that is what Musk thought he was posting, therefore it did not need per-approval. The SEC tried and failed to push the argument you are trying to push in court. You can view the complete docket here. https://www.courtlistener.com/docket/7946295/united-states-securities-and-exchange-commission-v-musk/ https://www.courtlistener.com/docket/7946295/united-states-s... You can find musk making the admission I claim he made above in this court filing. You can also find a better version of the argument I made about the tweet not needing pre-approval. https://www.courtlistener.com/recap/gov.uscourts.nysd.501755/gov.uscourts.nysd.501755.27.0_1.pdf https://www.courtlistener.com/recap/gov.uscourts.nysd.501755...
  - marvin 7y ago
    Thanks for the links, nice to see this clearly described. The journalists were much happier to write about a prospective scandal than about the fact that it didn't happen, so even as a not-quite-casual observer, it hasn't been so easy to pick up the details on this.
kevinventullo 7y ago
And according to https://www.statista.com/chart/13435/tesla-vehicle-production/ https://www.statista.com/chart/13435/tesla-vehicle-productio... this compares to 86k in Q4 2018, and ~25k in Q4 2017. As a long term investor, is the exact number all that important compared to the general shape of the curve? (N.b. I have no position in $TSLA)

gpm 7y ago

Get your dates straight. That tweet is before both that article and that updated agreement.

Someone1234 7y ago
> Nor does that agreement ban such tweets, it only requires that they are run by lawyers first. But it wasn't run by the lawyers because it contains a factual reporting error the lawyers would have flagged. Thus he violated the SEC agreement. Nobody said the tweet was banned. The tweet violated the agreement because it likely wasn't pre-approved (or his lawyers are really really bad).
- gpm 7y ago
  Sorry, I removed that and the next part of my post about 20 seconds after posting it exactly to avoid getting into pointless fights like this. We had bad luck with your refresh time... But, you are still messing up your dates. He did not violate the agreement because the original agreement was in effect at the time and it did not require running this past his lawyers. This has run out through court already, the SEC did not win.
  - aguyfromnb 7y ago
    >the SEC did not win. What do you mean? Tesla and Elon settled fraud charges: https://www.sec.gov/news/press-release/2018-226 https://www.sec.gov/news/press-release/2018-226 Stop the gaslighting.
    - gpm 7y ago
      The sec sued asking for punishment for violating the agreement. The judge basically said, ya, no, but why don't you guys write up a new one that everyone agrees on the meaning of. And that is what happened. A settlement where you get literally nothing that you asked for is a loss not a win. Edit: I just realized you linked to the wrong settlement. One sec, I'll find the right one for you. It seems that the SEC didn't release any press releases over their loss (shocking, I know) - but here is an article: https://www.bloomberg.com/news/articles/2019-04-26/musk-sec-settle-legal-fight-over-his-tweets-about-tesla-juykzbwq https://www.bloomberg.com/news/articles/2019-04-26/musk-sec-... - you could also refer to the original article you posted in your original incorrect claim that Musk violated the updated agreement.