Supreme Court refuses to accept Elon Musk's Twitter Sitter appeal.

Top line

The Supreme Court has declined to hear Elon Musk's appeal of a consent decree he signed in 2018 to settle a Securities and Exchange Commission lawsuit that required him to hire Tesla lawyers to review all of his tweets about the company.

Key facts

The SEC filed a lawsuit against Musk in 2018 after Infamous tweet The billionaire claimed to have secured “financing secured” to take Tesla private at $420 per share — which the SEC claimed “misled investors” and caused Tesla's stock price to rise rapidly.

Musk settled the case that same year, agreeing to pay $20 million in fines and a “Twitter Sitter” clause — which required Tesla's lawyers to approve any tweets about the company.

Tesla also had to pay separate civil fines worth $20 million, and Musk was forced to step down from his position as president of the electric car maker.

Musk's lawyers appealed the decision in September 2022, arguing that the “Twitter sitter” provision was “intimidating to Mr. Musk's speech” and violated his First Amendment rights to free speech.

The Supreme Court rejected Musk's appeal without comment, which is usual when the Supreme Court refuses to hear a case.

Why was Musk's case dismissed?

In a brief order issued in April 2022, a three-judge panel of the 2nd Circuit Court of Appeals upheld the SEC's order, arguing that Musk had presented “no evidence to support Musk's claim that the SEC used the consent decree for misconduct.” . Faith, harassing investigations into his protected speech.” The court also argued that the agreement was not substantially more burdensome on Musk, because it required him to follow policies imposed on other high-level Tesla executives. “Tesla’s communications policy, in turn, requires that covered communications undergo a prior approval process such that certain senior executives, including Musk, are not permitted to publish or disseminate without first consulting with Tesla’s general counsel or an internal official,” the court wrote. Home.” When the Supreme Court refused to accept the appeal, it upheld the decision of the Second Circuit Court.

Main background

Musk provoked the SEC again in 2021 after he published a Twitter poll He asks voters whether he should sell 10% of his Tesla shares. The agency sent subpoenas to Musk and Tesla over the tweet, and the billionaire responded by appealing the consent decree he initially signed in 2018 — arguing that it was unconstitutional and therefore unenforceable. “The Supreme Court has long addressed — and invalidated — unconstitutional conditions attached to a government benefit even when the complaining party agreed to accept the benefit in exchange for the condition,” Musk's lawyers wrote in their appeal.

the shadow

Musk also faced a class-action lawsuit over a 2018 tweet, which plaintiffs said cost investors a total of $12 billion, both from short sellers who lost money as the stock price rose rapidly, and from investors with long positions when the deal never materialized. . At trial last year, Musk testified that the $420 offer “wasn’t a joke” and was linked to a potential bid from the Public Investment Fund, Saudi Arabia’s sovereign wealth fund. Musk was ultimately found not liable for the damages.

Forbes rating

We estimate Elon Musk's net worth at $201.5 billion, based on his shares in companies including Tesla and SpaceX. His net worth rose again on Monday after Tesla shares rose 12%, surpassing Amazon founder Jeff Bezos. He is now the richest person in the United States

In-depth reading

More from ForbesElon Musk asks Supreme Court to overturn SEC sanctions over 'Secured Funding' tweet
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