Business & Tech
Tesla's Elon Musk Sued By SEC
The agency seeks to bar Musk from serving as a director or officer of any publicly traded company, including Tesla.
NEW YORK — The U.S. Securities and Exchange Commission sued Tesla Inc. Chief Executive Officer Elon Musk Thursday for allegedly sending false and misleading tweets about a potential plan to take Palo Alto-based electric car company private.
The civil lawsuit was filed in federal court in New York City. It asks for an injunction prohibiting violations of securities laws, forfeiture of any "ill-gotten gains," civil penalties and a court order barring Musk from serving as a director or officer of any publicly traded company.
Tesla is a publicly traded company. Musk, 47, of Los Angeles, co-founded it in 2003, has been its board chair since then and became the CEO in 2008.
Find out what's happening in Fremontfor free with the latest updates from Patch.
The allegedly false and misleading statements began with a now-famous tweet Musk sent to his 22 million followers on Aug. 7, saying, "Am considering taking Tesla private at $420. Funding secured."
In fact, the lawsuit alleges, Musk had not discussed specific deal terms with any potential financing partners and knew the possible transaction was uncertain.
Find out what's happening in Fremontfor free with the latest updates from Patch.
That tweet and subsequent tweets and comments "caused significant confusion and disruption in the market for Tesla's stock and resulting harm to investors," the lawsuit says.
Musk said in a statement released by Tesla, "This unjustified action by the SEC leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors.
"Integrity is the most important value in my life and the facts will show I never compromised this in any way," Musk said.
Steven Peiken, the co-director of the SEC's Enforcement Division in Washington, D.C., stated, "Corporate officers hold positions of trust in our markets and have important responsibilities to shareholders.
"An officer's celebrity status or reputation as a technological innovator does not give license to take those responsibilities lightly," Peiken said.
(Get Patch real-time email alerts for the latest news from your California neighborhood. Also, download the free Patch iPhone app or free Patch Android app. Also, be sure to follow your local Patch on Facebook!)
Also See:
- Identity Released Of Elderly Woman Killed In Highway 84 Crash
- List Of All ‘Diners, Drive-Ins and Dives’ Restaurants In Northern California
- The 100 Best Places To Live In California Ranked 2018
- Please Don't Help My Kids
— Bay City News; Image via Maggie Avants, Patch
