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The legal point isn't if what he tweeted was "that bad" or not. It's that after he got caught the last time, in the settlement to end the case he agreed to have Tesla legal review all such tweets in the future to make sure he doesn't do it again. He broke that agreement.

i believe elon’s argument is that the offending tweet didn’t need approval because he believed that he was just restating a projection made on the previous earnings call

What he believes doesn't matter, it's what he agreed to that matters, and he violated that agreement.

In a contempt hearing centered around violation of the terms of the settlement with the SEC, that's probably not a great argument. It's an error Musk would not have made if he'd simply adhered to the agreement and had a lawyer review what he tweeted.

The SEC saw that argument coming and shot it down completely in their filing:

> According to Tesla’s Policy, any edits to a pre-approved Written Communication or even releasing a verbatim pre-approved Written Communication more than two days after it has been pre-approved requires that the pre-approval be reconfirmed. Even if the exact substance of the 7:15 tweet had been pre-approved 20 days before, Musk cannot credibly claim that he thought he was not required to obtain pre-approval again under the plain terms of the Policy. In fact, the written communication in the 7:15 tweet was not pre-approved 20 days earlier or at any time. Musk’s claim that he thought he was simply restating information from the January 30 communications is not credible.

https://www.documentcloud.org/documents/5750664-Show-Cause.h... page 12

This tweet was not an edit to a pre-approved communication. That rule is irrelevant.

The argument is not "this tweet got approved before, so I can edit it however I want". The argument is "the number is already public information, so I can make a new post mentioning it".

> This tweet was not an edit to a pre-approved communication.

That is the problem, in a nutshell: it should have been pre-approved - according to the FCC's interpretation of the settlement agreement.

Maybe. But don't confuse different arguments about why. If the tweet needed pre-approval, it's for a reason entirely different from this quote.

Whether or not it's a valid argument, that does seem to be the SEC's argument here.

It's not the core of their argument, though. It's probably thrown in just in case it could possibly be considered relevant.

Yes but in this case he'd already said this publicly. Does Elon need to review tweets about things hes already publicly said?

Last year Elon made a series of deliberately false statements made with the sole purpose of artificially inflating the stock price of his crime. CEOs have gone to jail for years over misrepresentations less outrageous than Elons'. He was able to avoid prison time and hundreds of millions in fines by agreeing to a slap-on-the-wrist settlement with the SEC that required a small fine and, crucially, that his tweets be reviewed by someone else at the company before they were posted. So that no more material mispresentations would spew forth...like the one the SEC is now saying violates the settlement agreement.

If he wanted to keep tweet vomitting, he could have decided not to settle with the SEC last year and taken his chances.

He did no such thing. You are probably referencing a series of tweets where Elon was openly contemplating what would be required to buy back Tesla shares. The settlement with SEC clearly stated that no fault was found and no guilt admitted.

Why people get so excited about Musk spewing numbers over Twitter is beyond me, when the responsible course of action is to verify claims against other better vetted sources.

The crowd was eager to hang Elon over “funding secured” despite the entire deal being dependent on shareholder agreement.

The crowd is now eager to hang Elon over a typo.

I think it’s the crowd that needs to delete Twitter, not Elon.

Before you start discussing SEC rules remember these are all people who have been complicit in regulatory capture and they are all by definition the worst people for the job. They stood by while market manipulation was being performed daily through media publishing misleading stories in time to shake up morning trading. The SEC is corrupt to the core.

>He did no such thing. You are probably referencing a series of tweets where Elon was openly contemplating what would be required to buy back Tesla shares. The settlement with SEC clearly stated that no fault was found and no guilt admitted.

Yes, that's the "slap-on-the-wrist settlement" for Musk's securities fraud the parent was referring to.

>Why people get so excited about Musk spewing numbers over Twitter is beyond me

Because he is the head of a publicly traded company and spewing those numbers can violate the law.

>The crowd was eager to hang Elon over “funding secured” despite the entire deal being dependent on shareholder agreement.

Yes, that's precisely why his statement was fraud. He said he had funding secured when he didn't. He did this to manipulate the market.

Outside of the Musk cult, these are the laws people in Musk's position need to follow. If anything evidences SEC corruption it's Musk getting that sweetheart settlement for behavior that would land us average Joes in jail.

Your claim that the purpose was to manipulate the market has no evidence to support it.

If you want to talk about cults at least support your argument with evidence.

> The settlement with SEC clearly stated that no fault was found and no guilt admitted.

Who says that no fault was found? Surely not Musk. He didn’t admit or deny the allegations of the complaint. And:

Defendant understands and agrees to comply with the terms of 17 C.F.R. § 202.5(e), which provides in part that it is the Commission’s policy “not to permit a defendant or respondent to consent to a judgment or order that imposes a sanction while denying the allegations in the complaint or order for proceedings,” and “a refusal to admit the allegations is equivalent to a denial, unless the defendant or respondent states that he neither admits nor denies the allegations.” As part of Defendant’s agreement to comply with the terms of Section 202.5(e), Defendant: (i) will not take any action or make or permit to be made any public statement denying, directly or indirectly, any allegation in the complaint or creating the impression that the complaint is without factual basis; (ii) will not make or permit to be made any public statement to the effect that Defendant does not admit the allegations of the complaint, or that this Consent contains no admission of the allegations, without also stating that Defendant does not deny the allegations; ...

https://www.heise.de/downloads/18/2/5/1/1/4/0/4/SEC_Vergleic...

Public traded companies work like this:

You must tell the truth about how much money you make and spend, and report it annually to everyone, so they can make informed decisions about whether to buy or sell it the same as anyone else.

As long as you do, then you are allowed to sell stock. If you don't then you are not allowed to sell stock. The reasoning is obvious. It's too easy to commit fraud if you don't follow these rules. Therefore, you must agree to the rules to trade publicly. The SEC's job is to protect the public from fraud.

> This seems like a pretty simple mistake to have made

Elon Musk is the head of a public corporation, not a random Twitter user.

Making him immune to mistakes?

There’s a reason lawyers vet public statements by corporate officers.

Making him responsible for mistakes.

Meaning his mistakes move markets. Nobody has to be on Twitter. If you are and you're on the c-suite of a publicly traded company, you need communication discipline

So he should stop tweeting about company related matters unless someone has cleared him to do so.

Seriously why? Do you go around teeeting about potentially sensitive company info? Employees don’t do it, why is Elon doing it?

He's a human being who also happens to be the head of a public corporation. We can't expect every single action he takes at every point to be filtered into legalese.

IMO, if he had said this in an earnings call, or presented it in a way that made it seem "official", then I could get the problem, but it's twitter.

According to the company his twitter feed is an official source of information about the company.

Where?

https://www.google.com/search?rlz=1C1CHBF_enUS791US791&biw=1...

In one of their SEC filings. You need to search EDGAR.

from elsewhere in the thread: https://www.sec.gov/Archives/edgar/data/1318605/000119312513...

So if he created two twitter accounts, ElonMuskCorp and ElonMuskPersonal, would he be in the clear on the 'Personal account?

Only if he does not reveal any insider info on the personal account. Still needs his corp account tweets pre-vetted coz of previous violation.

We don't even hold our president liable for what he says on twitter.

Trump's twitter statements have actually been used in court to strike down several of his executive actions...

Only in rulings that were later overturned, AFAIK.

The rulings I am referring to still stand...

Several of the courts hearing DACA cases upheld the law, in at least one instance solely because of Trump's tweets established a racial motivation rather than a policy motivation for terminating the program.

The Muslim ban was heavily modified after courts repeatedly struck it down based on Trump's anti-Muslim tweets. The final version was designed to address the issues raised in the original rulings. It is limited to countries like Iran and Syria which are openly hostile to the US, and countries like Yemen and Somalia which have contributed a large portion of the membership of terrorist groups like Al Queada and ISIS. Two of the countries were added to that list Venezuela and North Korea) solely because they aren't Muslim. Persons on this list are feasibly national security concerns, which is just enough of a justification to uphold the travel ban on legal grounds.

Whataboutism.

username checks out

That's because our constitution has no non-political mechanism for holding the president to the law. Unfortunately for Musk, the SEC has no such limitation.

Yeah, it’s a bit of a disgrace really. Influencing global politics and destroying the US’s reputation in the world is apparently less relevant than someone potentially influencing some stocks.

I dunno, looking on from overseas it’s a bit surreal. Trumps tweets have normalized too, so it’s no news anymore when he tweets something outrageous.

Trump didn't commit securities fraud on Twitter. Yes, his Tweets are outrageous and absurd, but very few if any break the law. Him blocking people on Twitter was found to be unlawful and reversed by a court--for the same reason as Musk's activities, because he has repeatedly used his "personal" account for his job.

> IMO, if he had said this in an earnings call, or presented it in a way that made it seem "official", then I could get the problem, but it's twitter.

TSLA stated five years ago that Musk's twitter is an official source of information regarding the company.

Tesla registered his Twitter account as an official channel for such information. That brings with it expectations and obligations, since investors etc now have to read it to be fully informed, and has similar relevance to e.g. official Tesla press releases.

He specifically agreed to have Tesla legal review all such tweets to make sure he doesn't tweet bad information again, and promptly went and ignored that.

I don’t think the ballpark estimate 0-500k could possibly be interpreted as accurate/reliable (and by extension, bad) information.

Except by some particularly whiny people looking for an excuse.

He said "around 500k", not "0-500k". And the SEC isn't filing this because he tweeted "bad" information, but because he violated the settlement where he agreed to have Tesla legal review all such tweets, which he didn't do. That he had to correct the numbers just made it obvious that he might have failed to do so.

IMO, if he had said this in an earnings call, or presented it in a way that made it seem "official", then I could get the problem, but it's twitter.

As pointed out many times on this thread, Elon had Tesla designate his personal twitter account as an official source of material company information. Ergo, anything he posts to twitter is potentially subject to SEC reporting requirements.

If he didn't want that responsibility tied to his private account, he should have had Tesla create him a Tesla_CEO twitter handle that he could post from instead.

I actually agree with you somewhat; I'm a bit dismayed that any information at all on Twitter is being taken as worth a damn to any significant degree. It just means the day when I need a Twitter account to get anything done, creeps ever closer. But I feel like nobody else is concerned about that.

It's not about malice. It's well known that public statements by corporate officers and other key people can move the market so their statements tend to be scrutinized by all sides, including regulators. Another problem is it's often difficult to prove/disprove if a statement is an honest mistake or a misrepresentation (or even outright lie.) That's why it's so rare for company officials to go 'off script' when making public statements... pretty much everything they say is vetted by legal, PR and pretty much any impacted group in the company to ensure they don't step in it. Walking back / clarifying statements in his role can be much more costly than just keeping silent until you have the facts right.

It's a 'simple mistake' in his long line of ignoring well established SEC rules.

>was it that bad

>claimed 500k, but actually 400k

That's a 25% increase! Yeah that's bad! He was already warned for using twitter to spread misleading info about the value of his company. He should know better.

As others have pointed out, the issue is the SEC settlement that Musk agreed to. But to your question, yes, I think what he tweeted was bad, for a CEO and an engineer. The number he stated is literally off by 20%. How can you say what he did was an “honest mistake”, as if an engineer can’t be expected to know basic arithmetic? Or a CEO not to know that the peak rate of production per week is not the same as annual rate? Musk has all the info needed to make an accurate and still impressive claim — he chose to exaggerate. And he chose to do it after knowing the terms of the SEC settlement.

This, if anything, is a good lesson on why politicians and PR firms tend to speak the way they do.

Unfortunately, the baseline for your understanding requires a reasonable amount of intelligence, a reasonable amount of empathy, and a reasonable amount of ability to frame situations in context.

The reality is that, surprisingly enough to people like yourself, the majority of the population does not actually have all three of those abilities. It was something that was unbelievable to me until I was close to something that dealt with public opinion.

You are absolutely correct on your take of the situation. The reality, unfortunately, is that the majority of the population is not capable (not their fault) of understanding the situation at that level.

This is why messaging out of corporations and politicians tends to be so odd. The majority of people are simply not capable of understanding things at your level.

Edit: I would strongly encourage people here to look up the median reading level in the United States. Then find an example text above that reading level(it's around 9th grade) and realize that half of the United States is below that level

It's not about the 100K mistake; it's the fact that he signed an agreement with the government that all material information on his Twitter feed should be reviewed by Tesla's general counsel before being posted. This obviously was not, and it is obviously material even if he is reiterating guidance. Elon needs to live by the agreement he signed or face consequences.