News & Opinion | February 26, 2019 9:55 am

The SEC Asked a Judge to Hold Elon Musk in Contempt

Musk is accused of violating the terms of a settlement deal.

elon musk
Elon Musk (Joshua Lott/Getty Images)
Getty Images

The Securities and Exchange Commission asked a federal judge on Monday to hold Tesla CEO Elon Musk in contempt for violating the terms of a recent settlement agreement.

The request rekindles old tensions between the billionaire and the government entity, The Washington Post reported. In the past, Musk has openly taunted the agency, calling it the “Shortseller Enrichment Commission.”

Currently, the SEC is accusing Musk of breaking a deal to seek pre-approval of any potentially market-moving tweets about his car company when he tweeted on Feb. 19 that Tesla would make about 500,000 cars this year.

Just four hours after that tweet, he added that he “meant to say” the cars’ weekly production rate would equal up to about 500,000 on an annual basis but that the total car deliveries this year would be closer to about 400,000.

The SEC asked Tesla the next day if the tweets had been reviewed before being published — a requirement, according to the Post, of a settlement agreement Musk reached late last year.

The company said that the first tweet was not pre-approved and Tesla’s lawyers saw the second tweet after it was published and then contacted Musk to draft a corrective second tweet, the SEC said in a motion filed in the U.S. Southern District Court.

“As a result of his failure to comply with the [settlement, Musk] once again published inaccurate and material information about Tesla to his over 24 million Twitter followers,” the SEC said.