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Tesla's Musk, SEC reach deal over Twitter use

Credit: Reuters Studio
Published on April 27, 2019 - Duration: 01:44s

Tesla's Musk, SEC reach deal over Twitter use

It looks like Tesla CEO Elon Musk has dodged another bullet, after he and the U.S. Securities and Exchange Commission agreed on what he can or can't tweet.

Jane Lanhee Lee reports.

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Tesla's Musk, SEC reach deal over Twitter use

It looks like Tesla CEO Elon Musk has dodged another bullet, after he and the U.S. Securities and Exchange Commission agreed on what he can and can't tweet.

That's according to a court filing released late Friday (April 26).

The SEC sued Musk last year after he tweeted in Aug that he had "funding secured" to take Tesla private when the financing was not in place.

Musk settled the lawsuit, agreeing to step down as chairman and have the company's lawyers pre-approve written communications, including tweets with material information about the company.

But in February, the SEC accused Musk of violating that settlement by sending a tweet about Tesla's production, and asked a Judge in Manhattan to hold him in contempt.

Reuters reporter Alexandria Sage.

SOUNDBITE: REUTERS REPORTER, ALEXANDRIA SAGE, saying: "The next step is for the judge to approve this agreement.

There's no indication that she would not.

Since this is very similar to what was in the original settlement it just spells out in much clearer language exactly what tweets would need preapproval.

//If it's approved by the judge this resolution of the dispute between the SCC and Tesla really reduces an overhang on the stock.

Investors have been worried about this because there was always the possibility that the judge could potentially in the worst case scenario strip Elon Musk of his CEO role." The news helped push up Tesla shares nearly a percent in after-hours trading after the stock dropped over 5 percent on Friday during regular trading hours following worse than expected quarterly results earlier in the week.

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