The latest dust-up emerged late Monday when the Securities and Exchange Commission asked a federal court in New York to hold Musk in contempt for violating a $40 million settlement he begrudgingly reached with the U.S. stock market's chief regulatory agency five months ago.
Contempt charges are typically brought against individuals who defy a court order. The SEC settlement was approved by a judge last fall, exposing Musk to potential fines or even jail time if he is found to be in contempt. The SEC had sued Musk last September for using his Twitter account in August to announce he had secured financing for a potential buyout of Tesla -- news that caused the company's stock to swing wildly. He later backed off that buyout idea, but regulators concluded he never had lined up the money to pull off the deal that probably would have required at least $25 billion to pull off.
Musk acknowledged he didn't get company approval for the initial Feb. 19 tweet, according to the SEC, even though car manufacturing statistics can affect stock prices of automakers. In his defence, Musk said he didn't think his tweet needed clearance because he was basing it on information that had been disclosed in late January. Both Feb. 19 tweets occurred while the U.S. stock market was closed. Tesla's stock rose by just $1.10, or less than 1 per cent, the next day.
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