Tesla CEO Elon Musk has agreed to stop tweeting about Tesla’s financials without first getting his lawyer’s permission.
Last September, Elon Musk got into some pretty hot water with the Securities Exchange Commission (SEC) over a tweet he made that said Tesla had secured funding to be taken private. The tweet came at a time when Tesla’s longevity was seriously in doubt over its lack of liquidity and ability to manufacture the Model 3 electric car.
It was also a big legal problem as Tesla hadn’t made any official statements, and later it turned out that they hadn’t secured funding at all and these were really just musings by Musk. This brought in charges from the SEC, accusing musk of deliberately misleading investors and issuing false statements.
Musk was fined $20 million and forced to step down as chairman of Tesla Inc., although he was able to stay on as CEO. In a later tweet, Musk said it was “worth it.”
The SEC also kept a close eye on Musk and ordered him not to make statements about Tesla’s financial situation again, which of course Musk ignored and issued another tweet in February saying that Tesla would build 500,000 cars this year. This latest tweet brought charges from the SEC and another round of legal battles.
Which seem to have ended last Friday after Musk agreed to not issue any more tweets without first passing it by his lawyer. According to Reuters, Musk agreed “to submit his public statements about the company's finances and other topics to vetting by its legal counsel." That includes such topics “as financial statements, previously unreported production or delivery numbers, and other topics."
While this deal seems to have satisfied a federal court judge, SEC commissioner Robert Jackson is far from happy. "Given Mr. Musk's conduct, I cannot support a settlement in which he does not admit what is crystal clear to anyone who has followed this bizarre series of events," he said on Friday.
"Musk breached the agreement he made last year with the Commission — and with American investors.”
Musk has a history of thumbing his nose at the SEC, so we’ll have to see if this latest deal will stick. Based on Musk’s past behavior, it’s probably just a matter of time before another tweet gets him in more legal trouble.