Musk reaches settlement over Tesla tweets

ELON MUSK appears to have escaped further punishment in a settlement with a US regulator over his tweets.

The Tesla chief executive had faced possible fines and removal from his role over a February tweet about production figures if he had been found by a US court to be in breach of an agreement not to tweet material information about his company without legal approval, as argued by the Securities and Exchange Commission.

In a settlement yesterday, Mr Musk agreed to “obtain the pre-approval of an experienced securities lawyer” before making statements on topics including previously unpublished production numbers or sales or delivery numbers, new business lines unrelated to existing ones, projections or forecasts, and regulatory decisions.

The SEC said a tweet sent on February 19, which said Tesla would make half a million cars this year, violated a settlement from last year which required Mr Musk to seek a lawyer’s permission for certain statements about his company, and tried to hold the entrepreneur in contempt of court.

Mr Musk and Tesla also had to pay $20m each, and Mr Musk had to step down as chairman of the electric car and battery-maker. That settlement followed an August tweet by the chief executive, where he claimed to have funding to take Tesla private at $420 a share, a statement which the regulator said misled investors.

At a court hearing earlier this month a New York judge instructed Mr Musk to come to agreement with the SEC.

Judge Alison Nathan said the original settlement had a “lack of clarity”, as the two sides disagreed on what Mr Musk had to seek approval for, and told them to put on “their reasonableness pants” and come to an agreement.

If she approves this settlement it will resolve the regulator’s contempt claim, and hold Mr Musk to a much clearer standard in his online communications.