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Discussion Starter #1 (Edited)
The SEC complaint alleges that Musk issued "false and misleading" statements and failed to properly notify regulators of material company events.

Sources close to the company told CNBC the company was also expecting to be sued, though Tesla was not named as a defendant in the complaint.

In August, Musk tweeted that he was considering taking Tesla private, adding "funding secured."

https://www.cnbc.com/2018/09/27/tesla-falls-4percent-on-report-elon-musk-sued-by-sec.html

Among other remedies, the SEC is seeking to bar Musk from serving as an officer or director of a publicly traded company if found guilty.
 

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Elon Musk Charged with Securities Fraud for Misleading Tweets

FOR IMMEDIATE RELEASE
2018-219

Washington D.C., Sept. 27, 2018 —
The Securities and Exchange Commission today charged Elon Musk, CEO and Chairman of Silicon Valley-based Tesla Inc., with securities fraud for a series of false and misleading tweets about a potential transaction to take Tesla private.

On August 7, 2018, Musk tweeted to his 22 million Twitter followers that he could take Tesla private at $420 per share (a substantial premium to its trading price at the time), that funding for the transaction had been secured, and that the only remaining uncertainty was a shareholder vote. The SEC’s complaint alleges that, in truth, Musk had not discussed specific deal terms with any potential financing partners, and he allegedly knew that the potential transaction was uncertain and subject to numerous contingencies. According to the SEC’s complaint, Musk’s tweets caused Tesla’s stock price to jump by over six percent on August 7, and led to significant market disruption.

“Corporate officers hold positions of trust in our markets and have important responsibilities to shareholders,” said Steven Peikin, Co-Director of the SEC’s Enforcement Division. “An officer’s celebrity status or reputation as a technological innovator does not give license to take those responsibilities lightly.”

“Taking care to provide truthful and accurate information is among a CEO’s most critical obligations,” added Stephanie Avakian, Co-Director of the SEC’s Enforcement Division. “That standard applies with equal force when the communications are made via social media or another non-traditional form.”

The SEC’s complaint, filed in federal district court in the Southern District of New York, alleges that Musk violated antifraud provisions of the federal securities laws, and seeks a permanent injunction, disgorgement, civil penalties, and a bar prohibiting Musk from serving as an officer or director of a public company.

The SEC’s investigation, which is continuing, was conducted by Walker Newell, and Brent Smyth and supervised by Steven Buchholz, Erin Schneider, and Jina Choi in the San Francisco Regional Office. The litigation will be led by Cheryl Crumpton and Barrett Atwood.
https://www.sec.gov/news/press-release/2018-219
 

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16,17 volt
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so- what does that mean for Elon
slap on the wrist or does every short get a whack at him
or is there a chance of him getting punted
 

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Discussion Starter #4
so- what does that mean for Elon
slap on the wrist or does every short get a whack at him
or is there a chance of him getting punted
If found guilty, "Among other remedies, the SEC is seeking to bar Musk from serving as an officer or director of a publicly traded company"

Is he an officer of Tesla?

Fines are possibel as well.

If found guilty that feeds into any lawsuits by shareholders as well.
 

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If found guilty, "Among other remedies, the SEC is seeking to bar Musk from serving as an officer or director of a publicly traded company"

Is he an officer of Tesla?

Fines are possibel as well.

If found guilty that feeds into any lawsuits by shareholders as well.
Sad that such an intelligent and well meaning talent as Elon Musk could make such careless twitter statements without regard to the potential seriousness of the consequences. He really left the SEC with no choice. I just hope he (and Tesla) can find a way to get past this as they are still the true leaders in the progress of EV transition.....which is good for the world in so many ways.
 

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Discussion Starter #7
Sad that such an intelligent and well meaning talent as Elon Musk could make such careless twitter statements without regard to the potential seriousness of the consequences. He really left the SEC with no choice.
Musk tweets are a double edged sword as I have said before. He is very talented at generating PR. But these tweets can also cause problems. Remember when wind resistance was going to be a problem for the dreadnaught assembly line? Great PR, but the reality was that was never going to be a problem.

Now he's saying there is a shortage of car carriers to deliver Model 3's, something the car carrier company's dispute. It seems that bad logistics planning by Tesla is being spun as an external problem to cover poor management. Clever PR by Musk.

But the "Funding Secured" tweet went over the line legally (as did the pedophile tweets) and this time Musk's funding tweet is more serious than sales puffery.
 

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Shouldn't be a huge surprise, his tweets moved markets by billions of dollars. Then to go and say he wouldn't change a thing is just thumbing his nose at the regulatory authorities. He's got to learn some lessons and exhibit contrition, and remorse, or he's gonna get slapped down.

I mean just yesterday Tesla sent out a text-blast to thousands of people who have a Model 3 on order that they've been "matched" with a car and they want to know if you can take delivery by Sunday. What are you supposed to think? You've had a car "matched" to your order. If you say yes, and line up your cash, will you actually get contacted with a car by Sunday? Don't kid yourself. It's just Tesla being Tesla. I got the text-blast, I said yes, I got the confirmation text, and I went to my bank to make sure I could do the financing afterward, and now I wait for an empty promise to be filled. Wish us all luck.
 

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What Model 3 configuration did you order? Are you saying you got your VIN in that confirmation email ? Did they say the car was already at your delivery location? What city is the delivery center? Mostly curious about the region of the country theses cars are being sent too.


Sent from my iPhone using Tapatalk
 

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What Model 3 configuration did you order? Are you saying you got your VIN in that confirmation email ? Did they say the car was already at your delivery location? What city is the delivery center? Mostly curious about the region of the country theses cars are being sent too.


Sent from my iPhone using Tapatalk
No VIN. Starting Tuesday night into Wednesday morning texts went out from Tesla to perhaps 12,000 people who had Model 3s on order stating, "Hello from the Tesla Delivery team. Our logistics team has confirmed a Model 3 matching your order is available this week. Are you available to take delivery between 9/26-9/30?"

That's verbatim. "confirmed... match... available". I responded within seconds that I was ready to take delivery. 8hrs later I got, "Thank you for your quick response! We appreciate you confirming you are available. We will contact you shortly once we get a firm date from our logistics team." I and hundreds of others have been reporting the same texts and confirmations on the Tesla forums.

Several folks have talked to people at Tesla HQ and their service centers, and their delivery agents. Lots of confusion, but the texts seem to be real. One theory is that some Canadian Model 3s were cancelled due to tax credits expiring, leading to some excess inventory on the East coast. I'm in Maine, and would have to take Home Delivery, seems alot of work to make a delivery happen in just a few days. Just seems weird that you'd text blast people with "confirmed... matching... order... available", on super short notice, and then not get back to them, but that's Tesla being Tesla. They all seem to take after Elon.
 

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Discussion Starter #11
Sounds like a common car dealer tactic. "We have a car matching your needs, come on in". They don't really mean it, they just want you to eagerly stop in to start the dance.
 

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Sounds like a common car dealer tactic. "We have a car matching your needs, come on in". They don't really mean it, they just want you to eagerly stop in to start the dance.
I suppose, but this text went out to people who already ordered a car. This isn't for reservations, but actual orders. We're already waiting for a car to show up. Some people haven't heard from Tesla since they ordered online, so this is their first communication with the company in months. This is my first communication in a month and a half since I ordered. Unlike regular dealers, there's no price haggling, so there's no dance. We ordered a car, and we've given Tesla, our insurance info, our license info, our registration info. We've told them whether we're trading in a car. We've told them how we intend to pay. Everyone is just waiting for a MVPA and a VIN and a car.
 

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Sad because Tesla's shareholders and Tesla's buyers are both better off with Elon Musk at the helm. Don't know much about what kind of settlement Elon can negotiate; maybe he and Donald can agree to go through a 12-step Twitter Anonymous withdrawal program...

IMHO, Elon needs to learn to accept that the Tesla shorters.
 

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Elon Musk Settles SEC Fraud Charges; Tesla Charged With and Resolves Securities Law C

Settlement Requires Musk to Step Down as Tesla’s Chairman; Tesla to Appoint Additional Independent Directors; Tesla and Musk Agree to Pay $40 million in Penalties

FOR IMMEDIATE RELEASE
2018-226

Washington D.C., Sept. 29, 2018 —
The Securities and Exchange Commission announced today that Elon Musk, CEO and Chairman of Silicon Valley-based Tesla, Inc., has agreed to settle the securities fraud charge brought by the SEC against him last week. The SEC also today charged Tesla with failing to have required disclosure controls and procedures relating to Musk’s tweets, a charge that Tesla has agreed to settle. The settlements, which are subject to court approval, will result in comprehensive corporate governance and other reforms at Tesla—including Musk’s removal as Chairman of the Tesla board—and the payment by Musk and Tesla of financial penalties.

According to the SEC’s complaint against him, Musk tweeted on August 7, 2018 that he could take Tesla private at $420 per share — a substantial premium to its trading price at the time — that funding for the transaction had been secured, and that the only remaining uncertainty was a shareholder vote. The SEC’s complaint alleged that, in truth, Musk knew that the potential transaction was uncertain and subject to numerous contingencies. Musk had not discussed specific deal terms, including price, with any potential financing partners, and his statements about the possible transaction lacked an adequate basis in fact. According to the SEC’s complaint, Musk’s misleading tweets caused Tesla’s stock price to jump by over six percent on August 7, and led to significant market disruption.

According to the SEC’s complaint against Tesla, despite notifying the market in 2013 that it intended to use Musk’s Twitter account as a means of announcing material information about Tesla and encouraging investors to review Musk’s tweets, Tesla had no disclosure controls or procedures in place to determine whether Musk’s tweets contained information required to be disclosed in Tesla’s SEC filings. Nor did it have sufficient processes in place to that Musk’s tweets were accurate or complete.

Musk and Tesla have agreed to settle the charges against them without admitting or denying the SEC’s allegations. Among other relief, the settlements require that:

  • Musk will step down as Tesla’s Chairman and be replaced by an independent Chairman. Musk will be ineligible to be re-elected Chairman for three years;
  • Tesla will appoint a total of two new independent directors to its board;
  • Tesla will establish a new committee of independent directors and put in place additional controls and procedures to oversee Musk’s communications;
  • Musk and Tesla will each pay a separate $20 million penalty. The $40 million in penalties will be distributed to harmed investors under a court-approved process.
  • “The total package of remedies and relief announced today are specifically designed to address the misconduct at issue by strengthening Tesla’s corporate governance and oversight in order to protect investors,” said Stephanie Avakian, Co-Director of the SEC’s Enforcement Division.


“As a result of the settlement, Elon Musk will no longer be Chairman of Tesla, Tesla’s board will adopt important reforms —including an obligation to oversee Musk’s communications with investors—and both will pay financial penalties,” added Steven Peikin, Co-Director of the SEC’s Enforcement Division. “The resolution is intended to prevent further market disruption and harm to Tesla’s shareholders.”

The SEC’s investigation was conducted by Walker Newell, Brent Smyth, and Barrett Atwood and supervised by Steven Buchholz, Erin Schneider, and Jina Choi in the San Francisco Regional Office and Cheryl Crumpton in the SEC’s Home Office.
https://www.sec.gov/news/press-release/2018-226
 

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An expensive "lesson" but now he is free to move the company forward. (and perhaps with some meaningful assistance from his board of directors).
 

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I totally understand why Elon settled and moved on
I would have not have been so hasty
Disclosure, I am not a lawyer and what I say is for entertainment purposes only
Feel I have to say that now;)
My understanding is that it was said on twitter
My understanding is that twitter is a social media medium
Twitter has its own terms and conditions
Unlike news print, that has its own checks and measures and you pay before it goes to print
News print is a one way medium and I hold it to a higher standard than social medium
The whole idea of social media is spontaneous responses that may or may not be correct
You can respond to social media in your own way, it’s a two way interaction, or you can bring in a moderator and deal with it that way
https://twitter.com/en/tos
You understand that by using the Services, you may be exposed to Content that might be offensive, harmful, inaccurate or otherwise inappropriate, or in some cases, postings that have been mislabeled or are otherwise deceptive. All Content is the sole responsibility of the person who originated such Content. We may not monitor or control the Content posted via the Services and, we cannot take responsibility for such Content.
We reserve the right to remove Content that violates the User Agreement, including for example, copyright or trademark violations, impersonation, unlawful conduct, or harassment. Information regarding specific policies and the process for reporting or appealing violations can be found in our Help Center (https://support.twitter.com/articles/15789#specific-violations and https://support.twitter.com/articles/15790).

The SEC has a mandate to deal with public companies in a way to do no harm to the shareholders of said companies
My question is why didn’t the SEC just ask to have the tweet removed
What the SEC did was inflict more damage to said company than what the tweet originally did
 

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I think there was already a precedent set with Twitter being considered by the SEC as a medium for distributing material info. I forget the case, maybe something Netflix did? And, I think it's in Tesla's financials that material info can be distributed via Twitter. So, I get your point, but it seems like Elon knew that his tweets were material.

I totally understand why Elon settled and moved on
I would have not have been so hasty
Disclosure, I am not a lawyer and what I say is for entertainment purposes only
Feel I have to say that now;)
My understanding is that it was said on twitter
My understanding is that twitter is a social media medium
Twitter has its own terms and conditions
Unlike news print, that has its own checks and measures and you pay before it goes to print
News print is a one way medium and I hold it to a higher standard than social medium
The whole idea of social media is spontaneous responses that may or may not be correct
You can respond to social media in your own way, it’s a two way interaction, or you can bring in a moderator and deal with it that way
https://twitter.com/en/tos
You understand that by using the Services, you may be exposed to Content that might be offensive, harmful, inaccurate or otherwise inappropriate, or in some cases, postings that have been mislabeled or are otherwise deceptive. All Content is the sole responsibility of the person who originated such Content. We may not monitor or control the Content posted via the Services and, we cannot take responsibility for such Content.
We reserve the right to remove Content that violates the User Agreement, including for example, copyright or trademark violations, impersonation, unlawful conduct, or harassment. Information regarding specific policies and the process for reporting or appealing violations can be found in our Help Center (https://support.twitter.com/articles/15789#specific-violations and https://support.twitter.com/articles/15790).

The SEC has a mandate to deal with public companies in a way to do no harm to the shareholders of said companies
My question is why didn’t the SEC just ask to have the tweet removed
What the SEC did was inflict more damage to said company than what the tweet originally did
 

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Once Musk is no longer in control of the board of directors of Tesla, it opens up the possibility that the board could decide to replace him as CEO at some point in the future. Kind of reminds me of the situation that led to Steve Jobs leaving Apple.

In any case, I think these developments will help to improve the stability of the company, which is good for investors, and good for the continuing deployment of EVs.
 

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the problem that I have with all of this, is Elon posted his tweets under the term and conditions of twitter
you just cant take his tweet and use it without the term and condition of twitter
the rest of it is smoke and mirrors
then all your doing is making twitter a lawyers den ,where all they are doing is looking for their next paycheck
 
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