Elon Musk must testify in SEC probe of his Twitter takeover

12.02.2024

Tesla and SpaceX CEO Elon Musk has been ordered by a U.S. judge to testify in a Securities and Exchange Commission (SEC) probe regarding his 2022 acquisition of Twitter, as reported in a court filing on Saturday.

The SEC is investigating potential securities fraud related to Musk’s stock purchases in Twitter in 2022, leading up to his leveraged buyout of the social media company. Musk finalized the acquisition in October 2022, valued at around $44 billion, and subsequently rebranded it as X.

In the order dated February 10, 2024, federal magistrate judge Laurel Beeler emphasized that the SEC’s subpoena was legitimate and not harassment, stating that it was within the regulatory authority to seek relevant information for their investigation. Musk and his legal team have one week to coordinate the date and location for his testimony.

Despite Musk’s arguments against regulatory authority, including seeking Supreme Court intervention to overturn a settlement agreement with the SEC for Tesla, where Musk agreed to tweet approvals, the court upholds the SEC’s right to investigate.

Furthermore, SpaceX, led by Musk, is involved in legal battles with the National Labor Relations Board (NLRB) after the agency filed a complaint alleging unlawful employee termination. SpaceX’s lawsuit claims the NLRB’s structure violates the U.S. Constitution, mirroring a similar case against the NLRB by a former Starbucks employee. The SpaceX lawsuit aims to prevent the NLRB’s complaint from progressing in the U.S. District Court for the Southern District of Texas in Brownsville.