Elon Musk’s lawyer says a federal judge would trample on the Tesla CEO’s free speech rights if he ordered Musk to stop talking about 2018 tweets saying he had the funding to make Tesla a private company.
In a court document filed Wednesday, lawyer Alex Spiro said a motion from a group of Tesla shareholders seeking a gag order doesn’t establish that Musk’s comments would prejudice the pool of jurors who might hear the case.
Lawyers for the shareholders have argued that Musk is trying to influence potential jurors before the lawsuit comes to trial on Jan. 17, 2023. They contend that the CEO’s August 2018 tweets were written to manipulate the stock price, costing shareholders money.
In court documents, the shareholders say U.S. District Judge Edward Chen in San Francisco already has ruled that Musk’s statements about having the money to take Tesla private at $420 per share were false.
They also argue that Musk violated an October 2018 court settlement with U.S. securities regulators. He signed the agreement to pay a $20 million fine and not make any statements denying securities fraud allegations.
Musk is challenging the agreement, saying it is unconstitutional.
Spiro’s response comes about a week after Musk, the world’s richest person, made an offer to take over Twitter and turn it into a private company with a $43 billion offer that equals $54.20 per share. A free speech proponent, he made it clear he wanted less censorship on the platform.
“Twitter has extraordinary potential. I will unlock it,” Musk declared.
The social media giant’s board on Friday adopted a “poison pill” strategy that would make it prohibitively expensive for Musk to buy the shares.
At issue in the lawsuit is Musk’s April 14 interview at the TED 2022 conference, where he said he had funding secured to take Tesla private in 2018.
He said he only settled the case because bankers told him they would stop providing capital if he didn’t, and the Austin, Texas-based Tesla would have gone bankrupt.
This was a very important segment of the Tedtalk with @elonmusk! The SEC performed an open investigation, which led @elonmusk to make a very difficult decision. In his own words “it was like a gun being held to your child’s head” #EndBigBanks $tsla #ApeTogetherStrong #Apes pic.twitter.com/2wBXDIsdVp
— ???.???.?!$¢?????Ⓡ ™ ? (@Eathedisclaimer) April 14, 2022
Lawyers for the shareholders say Musk’s comments in the interview were an “unsubtle attempt to absolve himself in the court of public opinion” over misrepresentations made with his Aug. 7, 2018 tweets.
But Spiro wrote in his response that the shareholders didn’t show that Musk’s speech presented a “clear and discernable danger” that the whole community would be corrupted by pretrial publicity, or that finding 12 objective jurors would be impossible.
Musk’s comments merely reiterated the case that’s already on the public record in his challenge to the U.S. Securities and Exchange Commission settlement, Spiro wrote.
His motion noted that Musk is in the middle of a public offer to take over Twitter, which has led to a debate over censorship on social media.
Reporters, Spiro wrote, have compared this to Musk’s previous statements about taking Tesla private.
During the TED interview, Musk was asked if funding was secured for the Twitter deal, a reference to the 2018 Tesla tweets.
“Mr. Musk should be permitted to respond meaningfully and truthfully to inquiries such as this, and not be compelled to remain silent,” Spiro wrote.
If Musk violated the SEC agreement, the agency can ask a judge to scrap it and restore the securities fraud complaint.
The SEC declined to comment.
The Western Journal has reviewed this Associated Press story and may have altered it prior to publication to ensure that it meets our editorial standards.
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