Still, I'm a bit confused -- as much as I think he deserved to be fined/punished for it, the $20 million SEC fine did that.
It seems like he should be subject to an SEC fine or a shareholder lawsuit, but not both -- isn't it redundant? I would assume that the SEC fine was calculated as an "appropriate" punitive amount -- not a punitive amount minus what they expected a shareholder lawsuit would also result in?
It's comparable to criminal and civil law existing side-by-side: if you run a red light and someone gets hurt, you'll be fined for the traffic violation. But the victim is also going to sue you for medical expenses, work income missed, and compensation for any suffering.
Of course any compensation here is going to be paid by Tesla to shareholders of Tesla, who own the company anyway. It might make a difference for individuals based on when they are/were shareholders and when not. But absent such effects, it's a really strange system.
I wonder if Elon Musk will join the lawsuit. He's the single largest victim here, after all. That would be fun.
Here, the SEC is an administrative entity (part of the executive branch) with the power to levy fines. Now shareholders are filing a civil suit for damages. Sometimes, the SEC will participate in a multi-party settlement that can resolve administrative, civil, and even criminal charges at the same time - but that didn’t happen here.