WASHINGTON: The US Supreme Court on April 29 rejected an appeal from Elon Musk over a settlement with securities regulators that requires him to get approval in advance of some social media posts that relate to Tesla, the electric vehicle company he leads.
The justices did not comment in leaving in place lower-court rulings against Musk, who complained that the requirement amounts to “prior restraint” on his speech in violation of the First Amendment.
The case stems from messages Musk posted on Twitter in 2018 in which he claimed he had secured funding to take Tesla private. The tweets caused the company’s share price to jump and led to a temporary halt in trading.
The settlement with the Securities and Exchange Commission included a requirement that his posts on Twitter, now known as X, be approved first by a Tesla attorney. It also called for Musk and Tesla to pay civil fines over the tweets in which Musk said he had “funding secured” to take Tesla private at US$420 per share.
The funding wasn’t secured, and Tesla remains public.
The SEC’s initial enforcement action against Musk alleged that his tweets about going private violated antifraud provisions of securities laws. The agency began investigating whether Musk violated the settlement in 2021 when he did not get approval before asking followers on Twitter if he should sell 10% of his Tesla stock.
Musk acquired Twitter in 2022. – AP
