The top U.S. regulator, the Securities and Exchange Commission (SEC) recently filed a plan that outlines the distribution of the $40 million it had obtained as a settlement between the regulator and Tesla and its CEO Elon Musk. The civil settlement entailed a fine as well as advance approval for some of his tweets. However, although he is supposed to get approval from Tesla’s lawyers, Musk has continued with controversial tweets.
In February, lawyers for Musk said that the SEC had not kept its promise of distributing the payout to Tesla’s investors. Yet, it had moved forward to contain Musk’s speech. They said that the regulatory agency was harassing him with “endless” probes into his personal conduct.
In a Tuesday night court filing, the SEC laid out what it called a “fair and reasonable” plan that described how the $40 million, which has now increased to $41.2 million with interest, would be distributed to investors in Tesla.
When the SEC slapped the fine on Musk, it also put forth the requirement that Elon Musk should obtain pre-clearance from lawyers at Tesla for tweets and other public statements that related to the company’s affairs.
However, Musk continued to tweet some controversial posts including one in which asked his followers whether he should sell 10 percent of his shares and he said that he would abide by their decision. A majority of them voted Yes and the EV maker’s share price fell dramatically.
On Tuesday, he asked the court to end the decree that required clearance for his tweets. He said that the SEC was using the decree as a punishment as he has criticized the government. He had earlier said that he had agreed to the consent decree to safeguard Tesla as well as its shareholders.
On Tuesday, Alison Nathan, New York Southern District Judge asked the SEC to answer the request by Musk of terminating the consent decree by March 22, according to court filings. In the near future, Judge Nathan is expected to rule on the conduct of both sides–Musk and the SEC. The judge is expected to base the ruling after investigating whether both sides are following the rules.
Image Wikimedia: JD Lasica from Pleasanton, CA, US
