Elon Musk Seeks Dismissal of SEC Case

Tech billionaire Elon Musk is attempting to dismiss a case brought against him by the Securities and Exchange Commission (SEC). He argues that he has taken too long to report his increasing stake in Twitter, now known as X.

Musk’s legal team claims, “Even if we accept the SEC’s allegations as valid, the assertion is that he delayed reporting a beneficial ownership in 2022. The SEC has not shown any evidence that Musk harmed investors.” This was outlined in a 60-page document submitted recently.

Furthermore, they state that Musk corrected the alleged oversight as soon as it was identified, asserting there’s been no ongoing violation, intention to mislead, or actual harm. “This whole thing is just wasting the court’s time and taxpayer money,” the lawyer added.

The SEC filed the lawsuit in January, contending that Musk delayed informing regulators about his shares in Twitter prior to his acquisition of the platform in 2022. The complaint claims that shareholders lost hundreds of millions of dollars. The lawsuit came just days before President Trump was inaugurated on January 20.

According to SEC rules, investors are required to disclose their ownership if it exceeds 5% of a company. Musk reportedly did not declare his Twitter shares until April 4, 2022, at which point he held over 9% of the company, as stated in the SEC’s complaint.

In the meantime, the SEC conducted a survey regarding Musk’s purchase of Twitter stock.

“The SEC’s call for injunctive relief for future violations doesn’t meet the necessary criteria and won’t serve any legitimate need,” the lawyer argued. “The SEC’s theory for relief is not supported by the law or consistent with its own enforcement history.”

Musk bought Twitter in October 2022 for $44 billion.

This isn’t Musk’s first run-in with the SEC; regulators previously took action against him in 2018 after he tweeted about potentially taking Tesla private. That case concluded with Musk and Tesla each paying a $20 million civil penalty and Musk stepping down as Tesla’s president for three years.