The Securities and Exchange Commission (SEC) filed a lawsuit against Elon Musk on Tuesday, alleging that he violated securities laws by not disclosing his large stock position in Twitter before purchasing the company for $44 billion in 2022, now called X. The lawsuit contends that Mr. Musk waited 11 days before filing the required disclosure with the SEC, allowing him to buy shares at a lower price. This is the third time the SEC has taken legal action against Mr. Musk for securities violations.
Mr. Musk’s lawyer, Alex Spiro, has denounced the lawsuit as a “sham” and claimed that Mr. Musk has done nothing wrong. The lawsuit was filed during the final days of Gary Gensler’s tenure as SEC chair, and it is unclear if the incoming administration under President-elect Donald J. Trump will continue to pursue the litigation. Biden administration appointees have filed several last-minute lawsuits, and it remains to be seen how these cases will be handled by the new administration.
Mr. Musk, a close adviser to Mr. Trump, has been living at Mar-a-Lago and attending meetings and events with the president-elect. He was appointed as co-chair of a task force aimed at reducing the federal budget. The SEC’s investigation into Mr. Musk began in 2022 after he announced plans to acquire Twitter. Despite facing legal challenges and investigations, Mr. Musk completed the purchase and renamed the company X.
The lawsuit against Mr. Musk is part of a pattern of cases filed by outgoing administration appointees and may be subject to review by incoming regulators. The SEC has been working to compel Mr. Musk to testify about his share purchases, and the legal battle over his takeover of Twitter continues.