Elon Musk Invokes Eminem in Opposing SEC Decree That Requires Him to Take Preapproval for His Tweets

The SEC is investigating Musk's November 6, 2021, tweet asking his followers whether he should sell 10 percent of his Tesla stake.

By Reuters | Updated: 30 March 2022 10:37 IST

Elon Musk Invokes Eminem in Opposing SEC Decree That Requires Him to Take Preapproval for His Tweets

Photo Credit: Reuters

The US agency has said Musk was not immune from scrutiny over his Tesla-related tweets

Highlights

Elon Musk had tweeted asking followers if he should sell Tesla shares
Musk has stated that the SEC issued its subpoena in bad faith
He has since sold $16.4 billion (roughly Rs. 1,24,142 crore) in shares

Elon Musk on Tuesday likened himself to the rapper Eminem in seeking to throw out his 2018 agreement with the top US securities regulator requiring the Tesla chief executive to obtain preapproval for his tweets.

In a filing in federal court in Manhattan, Musk also renewed his effort to quash a US Securities and Exchange Commission subpoena for details on whether he and Tesla are complying with their disclosure requirements under the 2018 consent decree.

The SEC is investigating Musk's tweet on November 6, 2021, asking his followers whether he should sell 10 percent of his Tesla stake, to cover tax bills on stock options. He has since sold about $16.4 billion (roughly Rs. 1,24,150 crore) of his shares in the electric car company.

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In Tuesday's filing, Musk said requiring Tesla lawyers to vet some of his tweets was an unconstitutional prior restraint on his speech, violating the First Amendment.

"The (SEC) won't let me be or let me be me so let me see; They tried to shut me down," Musk said, quoting from Eminem's 2002 song "Without Me."

Eminem's lyrics referred to the Federal Communications Commission, which had fined radio stations playing "The Real Slim Shady," an Eminem song whose content it deemed offensive.

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Musk also said the SEC issued its subpoena in bad faith and could not pursue a "fishing expedition" to harass him.

The SEC declined to comment.

It has said Musk was not immune from scrutiny over his Tesla-related tweets, and should not be excused from the 2018 agreement because he found compliance "less convenient than he had hoped."

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That agreement stemmed from Musk's tweet on August 7, 2018, that he had "funding secured" to potentially take Tesla private. Musk said on Tuesday that the tweet was truthful.

The case is being overseen by US District Judge Alison Nathan. She last week won US Senate approval to become a federal appellate judge and may continue presiding over her existing cases.

The case is SEC v Musk, US District Court, Southern District of New York, No. 18-08865.

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