Lawyers for Tesla chief Elon Musk on Monday argued that USA regulators overstepped their bounds by calling for him to be held in contempt for a tweet.Musk had until the end of the day Monday to respond to an accusation by the Securities and Exchange Commission that he violated terms of a court-endorsed deal between him and the regulatory agency stating that he should avoid sending any tweet that could affect the price of Tesla shares.His attorneys contended in a court filing that Musk did not violate the court's order and that there is no basis to issue contempt sanctions against him. As the SEC investigated Musk's claim, the agency discovered Musk hadn't run the tweet by a company lawyer before he sent it, a violation of the terms of the settlement a year ago.
Tesla has only released a handful of teaser images of its compact electric SUV, none of which offer us a great look at it. He added that more detailed specs and pricing as well as test rides will be available at the reveal event on Thursday. Tesla's counsel reviewed the tweet after it was posted.More news: 'Empire' Actor Jussie Smollett enters not guilty plea
Musk called the regulator the "Shortseller Enrichment Commission" on Twitter after the settlement, and tweeted that "something is broken with SEC oversight" just one day after the agency started pursuing the contempt order. Musk stated that Tesla will prioritize the customers who hold the reservation and waiting for the base version. Two days later, Musk accepted a settlement with more onerous terms.
As part of that settlement, Musk stepped down as the company's chairman and he and Tesla agreed to pay US$20 million each in fines. The company, as well as the CEO Elon Musk have been teasing details over the past few months.
Tesla is known to have missed production targets before, though, so there's a chance things may change.More news: US prosecutors probing Facebook's data deals, New York Times says
The SEC said in its request to hold the Tesla CEO in contempt that this pattern of behavior showed Musk "did not intend to diligently attempt to comply with the [terms of the settlement]".
Lawyers for Musk have accused the SEC of overreach, arguing the push to hold him in contempt of court over his Twitter post infringes on his First Amendment rights.
"While Musk claims to "respect the justice system", his deliberate indifference to compliance with this Court's Final Judgment indicates otherwise", lawyers for the SEC wrote in February. "Musk never consented to and would not consent to such a sweeping gag order".More news: Avengers: Endgame harks back to MCU's early days