Feds Want Judge To Force Elon Musk To Testify About Twitter Purchase After Billionaire Failed To Appear
The Securities and Exchange Commission wants a word with Elon Musk.
The agency has asked a federal judge in San Francisco to compel the billionaire social media honcho to testify in its investigation of Musk’s 2022 purchase of Twitter (now X). The filing in U.S. District Court notes that he “failed to appear for testimony on September 15, 2023, as required by the investigative subpoena served by the SEC.”
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According to today’s filing (read it here): “Instead, two days before his scheduled testimony, Musk abruptly notified the SEC staff that he would not appear. Musk attempted to justify his refusal to comply with the subpoena by raising, for the first time, several spurious objections, including an objection to San Francisco as an appropriate testimony location.”
The testimony subpoena relates to the SEC’s investigation launched in April 2022 into potential violations of various provisions of federal securities laws in connection with Musk’s 2022 purchases of Twitter stock, and his 2022 statements and SEC filings relating to the social media giant. According to the filing, the SEC “seeks Musk’s testimony to obtain information not already in the SEC’s possession that is relevant to its legitimate and lawful investigation.”
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Musk appeared for half-day sessions of testimony to the SEC by videoconference twice during July 2022.
Since Musk’s last half-day of testimony on July 27, 2022,” the SEC filing reads, “the Commission has received thousands of new documents from various parties as part of its investigation, including hundreds of documents produced by Musk. Nearly half of the documents produced to the Commission by Musk in this investigation were produced after Musk’s prior investigative testimony over a year ago, including documents Musk authored. The SEC has therefore not yet had the opportunity to question Musk regarding, among other things, the information contained in those documents.”
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A hearing on the filing is set for November 9.
Here is the full text of the SEC filing:
The Securities and Exchange Commission (“SEC”) announced that it has filed an application seeking an order directing Elon Musk (“Musk”) to comply with an investigative subpoena calling for his appearance for testimony, with which Musk failed to comply.
If a person or entity refuses to comply with a subpoena issued by SEC enforcement staff pursuant to a formal order of investigation, the Commission may file a subpoena enforcement action in federal district court seeking an order compelling compliance.
According to the SEC staff’s filing in the U.S. District Court for the Northern District of California, the testimony subpoena to Musk relates to an ongoing investigation by the SEC regarding, among other things, potential violations of various provisions of the federal securities laws in connection with (a) Musk’s 2022 purchases of Twitter, Inc. (“Twitter”) stock, and (b) Musk’s 2022 statements and SEC filings relating to Twitter. According to the filing, the SEC seeks Musk’s testimony to obtain information not already in the SEC’s possession that is relevant to its legitimate and lawful investigation.
According to the filing, Musk failed to appear for testimony as required by the investigative subpoena served by the SEC, despite: (1) agreeing to appear for testimony on a mutually agreed upon date in September 2023; (2) having been served with a subpoena in May 2023 requiring his appearance for testimony in the SEC’s San Francisco Regional Office on that mutually agreed upon date; and (3) raising no objection to the subpoena from May 2023 until two days before his scheduled testimony date in September 2023, when Musk notified the SEC that he would not appear. According to the filing, Musk attempted to justify his refusal to comply with the subpoena by raising, for the first time, several spurious objections.
The SEC staff’s application seeks an order from the court directing Musk to comply with the subpoena. The application is subject to the court’s ruling. The SEC staff is continuing its fact-finding investigation and, to date, has not concluded that any individual or entity has violated the federal securities laws.
Tom Tapp contributed to this report.
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