Supreme Court declines to hear Musk challenge to SEC order over Tesla posts
The Supreme Court on Monday declined to hear Elon Musk’s challenge to a 2018 settlement agreement with the Securities and Exchange Commission (SEC) that required lawyers to approve some of the billionaire’s public posts about Tesla.
The Tesla CEO filed an appeal with the Supreme Court in December, arguing that the agreement is a “prior restraint” on his First Amendment speech rights and is unconstitutional.
“The pre-approval provision in Mr. Musk’s consent decree, as embodied in the amended final judgment, is a quintessential prior restraint that the law forbids. It restricts Mr. Musk’s speech even when truthful and accurate,” his lawyers argued in their petition to the high court.
“It chills Mr. Musk’s speech through the never-ending threat of contempt, fines, or even imprisonment for otherwise protected speech if not pre-approved to the SEC’s or a court’s satisfaction,” they added.
The 2018 settlement agreement stems from allegations that Musk was influencing Tesla's stock with social media posts, specifically a tweet about his intentions to take Tesla private, that caused the company’s stock to rise.
In 2022, Musk asked a lower court to modify or end the agreement, arguing it was unconstitutional and had been abused by the SEC to improperly police his speech.
A federal appeals court rejected his challenge last May, saying it found “no evidence to support Musk’s contention that the SEC has used the consent decree to conduct bad-faith, harassing investigations of his protected speech.”