Tesla share price up 2% after court rules in dispute with SEC
A judge rules that the Tesla founder and the SEC have to reach an agreement in a battle over tweets.
Tesla share price is up after a court appearance by the car company’s founder, Elon Musk. A judge recently ordered that Musk and the Securities Exchange Commission (SEC) must reach a new agreement in its settlements about Musk’s tweets about his company’s production numbers.
Why was Elon Musk in court?
Musk was in court to settle a dispute with the SEC over his tweets. The agency said he should be held in contempt for violating an earlier agreement he made with the agency after he incorrectly tweeted in autumn 2018 about taking the company private. The agency said he ignored an arrangement they reached with Musk in which he agreed to tweet with input from other executives when he incorrectly tweeted in 2019 about how many cars the company had in production.
Musk denied the accusation that he used Twitter without consulting Tesla staff and said he corrected his erroneous message. He also said the agency was violating his First Amendment right to express himself on Twitter.
SEC comments about Musk
During a court hearing about the settlement, Cheryl Crumpton, SEC representative, said that Tesla never intended to enforce the agreement Musk made with the government agency.
‘Tesla still appears to be unwilling to exercise any meaningful control over the conduct of its CEO,’ said Crumpton.
Crumpton also recommended Musk pay fines for violation of the agreement.
Musk’s response to SEC
Musk’s attorney, John Hueston, said that he honored the agreement with the SEC.
‘We think it's very clear that Mr. Musk retained discretion in the policy,’ said Hueston.
‘He actually does what he is told,’ added Musk’s lawyer.
Judge’s ruling about Tesla and SEC dispute
US District Judge, Alison J. Nathan, urged the two sides to come to an agreement within two weeks. She said if an agreement is not reached, she’ll decide whether or not to grant the SEC’s request to fine Musk for his tweets.
‘Everybody take a deep breath, put your reasonableness pants on and work this out,’ said Nathan.
Musk expressed relief with the decision in a statement.
‘I have great respect for Judge Nathan, and I’m pleased with her decision today,’ said Musk.
Tesla shareholders and legal experts will revisit the Tesla-SEC standoff later this month to see if the two sides can settle their disagreement.
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
Act on stock opportunities today
Go long or short on thousands of international stocks with CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
