Tesla revealed Monday morning that it had been subpoenaed for a second time by the U.S. Securities and Exchange Commission (SEC) over CEO Elon Musk’s tweets in 2018 about taking the company private, according to a Tesla quarterly report filed with the SEC.
The filing marks the second time in nine months that Tesla has been subpoenaed to ensure compliance with a settlement between the SEC and Tesla regarding Musk’s use of Twitter. In October 2018, Musk and Tesla were each fined $20 million dollars and the two parties agreed that all tweets by Musk about the company must be pre-approved by Tesla lawyers following a tweet Musk made about taking the company private at “$420 a share.” (RELATED: Tesla Suspends Trading After Elon Musk’s Cryptic Tweet On The Company’s Future)
Am considering taking Tesla private at $420. Funding secured.
— Elon Musk (@elonmusk) August 7, 2018
Musk also insisted that he had the “funding secured” to take Tesla private. This led to significant volatility in Tesla stock, which caused some shareholders, short-sellers in particular, to lose money, according to Reuters.
Investors filed a class action lawsuit, and a judge found in April that Musk knowingly made a false statement when he tweeted that the funding had been secured. The trial in this case has been set for January 2023.
Musk has continued to use Twitter to discuss his business plans; in a November 2021 tweet, Musk proposed selling 10% of his Tesla stock.
Much is made lately of unrealized gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock.
Do you support this?
— Elon Musk (@elonmusk) November 6, 2021
Musk accompanied the proposition with a poll, and promised in the same thread “I will abide by the results of this poll, whichever way it goes.” The poll ended in favor of selling, and Musk claims that he hit his target near the end of December, 2021, according to CNBC.
Musk has since sold approximately 9.6 million additional shares of Tesla for around $8.5 billion dollars in an effort to acquire the funds to purchase Twitter, according to Forbes.
Neither the SEC nor Tesla responded to a request for comment.