Sunday, February 25, 2024
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Elon Musk must testify in SEC probe of his Twitter takeover, judge says


An image of Elon Musk is seen on a mobile device with the X and Twitter logos in the background in this photo illustration, July 23, 2023.

Jonathan Raa | Nuphoto | Getty Images

You’re here and SpaceX CEO Elon Musk must testify in an investigation by the U.S. Securities and Exchange Commission into its 2022 acquisition of Twitter, a federal judge ordered Saturday.

As CNBC previously reported, the SEC is investigating whether Musk or anyone else committed securities fraud in 2022 as the billionaire began buying shares on Twitter and building a stake before his leveraged buyout of social media company.

Musk completed his acquisition of Twitter in October 2022 in a deal worth around $44 billion and has since rebranded it as X.

In the order dated February 10, 2024, federal judge Laurel Beeler wrote that although Musk and his legal team argued that the SEC’s subpoena in this case amounted to harassment against the billionaire, the financial regulator The federal government was “within its authority” and its subpoena was “final and seeking information relevant” to its investigation.

The federal financial regulator and Musk now have a week to set the date and location for his testimony.

Musk, his lawyer Alex Spiro and the SEC did not immediately respond to requests for comment.

Musk has repeatedly sought to challenge and even remove the authority of federal regulatory agencies.

For example, he asked the U.S. Supreme Court to overturn a settlement agreement he and Tesla previously reached with the SEC. The settlement required Musk to ask a “Twitter gatekeeper” to approve his tweets about his electric vehicle business before posting them. Musk’s lawyers argued that the agreement imposed an unconstitutional condition on Musk and amounted to a violation of his free speech rights.

In another example, SpaceX, a defense company led by Musk, sued the National Labor Relations Board after the federal agency filed a lawsuit against the company, alleging the rocket maker illegally fired employees who had signed an open letter criticizing Musk. The letter stated, among other things, that “Musk’s behavior in the public sphere is a frequent source of distraction and embarrassment to us.”

SpaceX filed a lawsuit against the NLRB in the U.S. District Court for the Southern District of Texas in Brownsville. SpaceX lawyers argued in their lawsuit that the very structure of the federal labor board violated the U.S. Constitution. Their suit is similar to one filed by a former Starbucks employee against the NLRB and seeks to block the NLRB’s earlier complaint against SpaceX from moving forward.

Read the full in order to enforce compliance here.



Note: The content and images used in this article is rewritten and sourced from www.cnbc.com

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