The US Supreme Court has declined to hear Elon Musk’s appeal regarding his agreement with the Securities and Exchange Commission (SEC) over his social media posts. Musk’s request to have an in-house lawyer pre-approve his Twitter activity concerning Tesla Inc. has been left intact.
Background
The legal battle stems from Musk’s infamous tweet in August 2018, where he claimed to have “funding secured” to take Tesla private, resulting in a surge in Tesla’s stock value. The SEC subsequently sued Musk, alleging that the tweet misled shareholders. Musk settled with the SEC, agreeing to step down as Tesla chairman and pay a $20 million fine.
Recent Developments
In 2021, Musk reignited the conflict by posting a Twitter poll about selling 10% of his stock. This led the SEC to issue subpoenas to Musk and Tesla. Musk then sought to annul his pre-screening agreement, arguing that it infringed upon his free speech rights. However, a federal appeals court rejected his claims last year.
Legal Arguments
Musk’s legal team contended that the pre-approval requirement constituted an unconstitutional prior restraint on his speech. They argued that the provision continues to inhibit Musk’s ability to freely communicate with the public.
In response, the SEC maintained that parties involved in litigation can waive fundamental constitutional rights, urging the Supreme Court to dismiss Musk’s appeal without further review.
Conclusion
With the Supreme Court’s decision, Musk’s agreement with the SEC remains in force, requiring him to obtain pre-approval for his social media posts about Tesla. The case underscores the complexities surrounding the intersection of free speech rights and regulatory oversight in the digital age.