The Supreme Court has rejected Elon Musk's appeal to overturn a settlement agreement with the Securities and Exchange Commission (SEC) related to his Twitter posts about Tesla. In 2018, Musk tweeted that he had "funding secured" to take Tesla private at $420 a share, which the SEC deemed fraudulent and led to significant fluctuations in the company's stock price.
As part of the settlement, Musk agreed to have a company lawyer review his social media posts about Tesla before publishing them, a provision known as the "Twitter sitter." However, Musk later challenged this requirement, arguing that it violated his First Amendment rights.
Despite owning Twitter, now rebranded as X, Musk has continued to contest the settlement agreement. His appeal was rejected by both the US District Court and the 2nd US Circuit Court of Appeals, which found no evidence to support his claims of bad-faith investigations by the SEC.
The appeals court panel noted that Musk had the option to litigate or negotiate a different agreement but chose not to do so. The Supreme Court's rejection of his appeal without comment or dissents marks the end of the road for Musk's challenge to the settlement agreement.
The "Twitter sitter" provision remains in place, requiring Musk to have his social media posts about Tesla reviewed by a company lawyer before publication. This outcome is a significant win for the SEC, which has been seeking to hold Musk accountable for his tweets about Tesla.
Musk's tweets have been a subject of controversy in the past, with some accusing him of using his social media platform to manipulate Tesla's stock price. The SEC has been monitoring his tweets closely, and this settlement agreement ensures that his posts about Tesla will continue to be scrutinized to prevent any potential fraud or market manipulation.
The Supreme Court's decision is a reminder that even high-profile figures like Elon Musk must adhere to securities laws and regulations. The outcome of this case serves as a warning to other executives and public figures who may use social media to discuss their companies or investments.
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