Tesla CEO Elon Musk’s trigger-happy behaviour on social media website Twitter could prove to be fatal this time, and according to some securities lawyers who spoke to CNBC, he could be suspended as the CEO of the company. Musk had been instructed by the court to not speak about sensitive information about Tesla on social media, but last month he tweeted out a photograph and wrote about the possible output of a particular model of cars. The court has given him a deadline until the 11th of March within which he has to explain why he should not be held in contempt of a court directive. This directive was a part of the Securities and Exchange Commission settlement that Musk had agreed on last year and many lawyers believe that it is in fact a violation of the agreement.
Elliot Lutzker, who had previously been a part of the enforcement wing of the SEC, spoke to CNBC and said that the Tesla CEO could be in a bit of trouble. He said, “It is looking pretty ominous for Musk. I could very easily see a very significant fine and a possible suspension.” As per the settlement, Musk was supposed to run any sensitive tweets through a vetting team, but it seems he did not do that when he tweeted “Tesla made 0 cars in 2011, but will make around 500k in 2019.” The tweet was published on the 19th of February and Musk was immediately hauled up by the SEC.
However, in Musk’s defence, he tweeted a few hours later with an explanation and wrote, “Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for the year still estimated to be about 400k.” That being said, it is unlikely that it is going to help him much with the contempt of court proceedings, according to seasoned lawyers.
At the time, Musk had said that the projections that he tweeted out consisted of information that was already available in public and that is why he did not go through a vetting process. Jay Knight, who had been employed by the SEC in the past, stated that the court will come down hard on the Tesla CEO since it is important to send a tough message to other heads of companies who might be just as trigger happy regarding sensitive information on social media.