The US Securities and Exchange Commission wants a federal judge to hold Tesla CEO Elon Musk in contempt for violating a settlement agreement with the agency, after he tweeted an inaccurate statement about his company’s car production last week.
In a tweet last Tuesday, Musk wrote, “Tesla made 0 cars in 2011, but will make around 500k in 2019,” before later correcting himself in a subsequent message. In a filing on Monday in federal court in Manhattan, the SEC argued that the billionaire “once again published inaccurate and material information about Tesla to his over 24 million Twitter followers.” Tesla reached an agreement with the SEC last October in which the company consented “to oversee and pre-approve Musk’s Tesla-related written communications” with material information to shareholders.
Monday’s filing is the latest legal salvo in the ongoing battle between the SEC and Musk, who has not hidden his contempt for the nation’s securities regulator since drawing its ire last summer. Last August, Musk tweeted that he was considering taking Tesla private at a price of $420 a share, sending the stock shooting up, despite the fact that Musk had no viable funding source in place to secure such a deal. The SEC then investigated, leading to an initial settlement, which Musk agreed to and then pulled out of, causing the agency to sue the company and its mercurial founder.
Musk and Tesla eventually settled in the fall, paying a collective $40 million to the SEC. Musk agreed to step down as chair, and the company also agreed to appoint two new independent board members and an independent chairperson. The SEC required Tesla to “put in place additional controls and procedures to oversee Musk’s communications,” something it is now alleging the company did not do, in light of the billionaire’s tweet last week.
The SEC declined to comment beyond the filing. A Tesla spokesperson did not immediately return a request for comment.