On Monday, the Supreme Court rejected the appeal submitted by Elon Musk Regarding a settlement with securities regulators that requires him to obtain prior approval for certain tweets related to Tesla, the electric car company he drives.
The justices did not comment on setting aside the lower court's rulings against Musk, who complained that the requirement amounted to “prior restraint” on his speech in violation of the First Amendment.
The case stems from tweets posted by Musk in 2018 in which he claimed to have secured funding to take Tesla private. The tweets caused the company's stock price to rise and led to a temporary halt in trading.
The settlement with the SEC included a requirement that Tesla's lawyers first approve his tweets. It also called on Musk and Tesla to pay civil fines over tweets in which Musk said he had secured “financing secured” to take Tesla private at $420 per share.
Financing was not secured, and Tesla remained public.
The SEC's initial enforcement action against Musk alleged that his tweets about going private violated anti-fraud provisions of securities laws. The agency began investigating whether Musk violated the settlement in 2021 when he did not obtain approval before asking his Twitter followers, now X, whether he should sell 10% of his Tesla shares.
Musk acquired Twitter in 2022.
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