Supreme Court to Musk: No!

Elon Musk

(5MinNewsBreak.com) – Tesla CEO Elon Musk must continue to exercise caution regarding his posts on the social media platform X, as he has suffered a massive legal setback at the United States Supreme Court.

On Monday, the US Supreme Court chose not to consider the billionaire’s challenge against the restrictions imposed by the Securities and Exchange Commission (SEC) on his communications related to Tesla, which were part of a settlement agreement from 2018.

Musk had petitioned the court to evaluate whether this agreement infringed upon his free speech rights.

The refusal to hear Musk’s appeal means that the decision of the appellate court, which rejected Musk’s attempt to alter or terminate the 2018 agreement, remains in effect, USA Today reports.

The appellate court, a three-judge panel from the 2nd Circuit Court of Appeals in New York, previously found no merit in Musk’s claims.

“We see no evidence to support Musk’s contention that the SEC has used the consent decree to conduct bad-faith, harassing investigations of his protected speech,” the judges noted last year.

The SEC initially pursued Musk following his 2018 tweets suggesting that he might take Tesla private, backed by sufficient funding.

“Am considering taking Tesla private at $420. Funding secured,” Musk disclosed on what is now known as X, a platform he acquired in 2022.

The SEC labeled these tweets as “false and misleading” and held that they were responsible for significant disruptions in the market and artificially inflated Tesla’s stock price.

As a result of these allegations, Musk and Tesla entered into separate settlement agreements with the SEC.

These settlements required Musk to resign as chairman and pay a $20 million fine, as well as to obtain preapproval from a Tesla-designated attorney before issuing any written communications about the company.

Nevertheless, the SEC later accused Musk of breaching this agreement when he tweeted about Tesla’s production rates without prior approval, leading to allegations of spreading misleading information.

Following further discussions, the initial terms of the settlement were amended.

However, Musk’s tweets in November 2021, in which he asked his followers to vote on whether he should sell 10% of his Tesla shares, once again prompted regulatory intervention.

In response, Musk challenged the constitutionality of the settlement terms.

Both the district and appeals courts dismissed Musk’s constitutional challenge.

Despite this, Musk sought intervention from the Supreme Court to halt what he described as “egregious agency overreach.”

Copyright 2024, 5MinNewsBreak.com