2025-04-01
In January
2025, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against
Elon Musk, alleging that he failed to disclose his acquisition of Twitter stock
in a timely manner during early 2022.
According to the SEC, Musk's delayed
disclosure allowed him to purchase additional shares at artificially low
prices, resulting in an underpayment of at least $150 million.
By March 14, 2022, Musk had acquired
over 5% of Twitter's shares, a threshold that legally requires public
disclosure within ten days.
However, he did not file the necessary
disclosure until April 4, 2022, 11 days past the deadline.
During this period, Musk continued to
purchase more than $500 million worth of Twitter stock.
The SEC contends that this delay
deprived investors of important information and led to financial harm for those
who sold shares at deflated prices.
In response to the lawsuit, Musk's
attorney, Alex Spiro, dismissed the allegations, asserting that Musk "has
done nothing wrong" and describing the legal action as a "sham."
As of March 31, 2025, both parties have
agreed on a timeline for Musk to respond to the SEC's complaint. According to a
joint motion filed on that date, Musk has agreed to file his response by June
6, 2025. This agreement aims to conserve judicial resources and expedite the
legal process.
This lawsuit adds to Musk's history of
legal challenges with the SEC. In 2018, he settled fraud charges related to
tweets about taking Tesla private, agreeing to pay a $20 million fine and step
down as Tesla's chairman for three years.
The Securities and Exchange Commission
is moving ahead with its $150 million lawsuit against Elon Musk, accusing the
billionaire of misleading investors during his 2022 purchase of Twitter stock.
The lawsuit, originally filed in
January 2025 in the final days of the Biden administration, alleges that Musk
failed to disclose his significant stake in Twitter by the required March 24,
2022 deadline.
By delaying the disclosure, the SEC
claims Musk was able to buy shares at a lower price, ultimately saving at least
$150 million before the stock price surged 27% after his stake was made public.
In a statement, Musk’s attorney Alex
Spiro dismissed the case as baseless, saying, “Elon has done nothing wrong,”
and labeling the lawsuit a “sham.”
The case is the latest in a series of
legal clashes between Musk and federal regulators. In 2023, the SEC also sued
him for refusing to testify about the Twitter acquisition, after he abruptly
withdrew from a scheduled interview with the agency.
Despite Musk’s challenge to the
validity of the lawsuit’s service, the SEC is pushing forward, maintaining that
the tech mogul’s actions violated securities law and harmed investors.
