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Angelo Zino says Twitter has the ‘upper hand’ amid Musk takeover
CFRA Research senior equity analyst Angelo Zino discusses the Elon Musk-Twitter deal and the performance of tech stocks amid a volatile market.
Lawyers for Elon Musk say the government is unlawfully muzzling the billionaire with a 2018 settlement that requires his tweets about Tesla to be pre-approved by the company's lawyers before being sent out.
Musk's lawyers filed a legal brief Wednesday with the federal appeals court in Manhattan arguing against a lower court's decision to uphold the deal with the Securities and Exchange Commission. Attorney Alex Spiro contends the SEC has used the pre-approval provision as a "government-imposed muzzle" on Musk's speech before it is even made on a broad range of topics.
"Since the judgment was entered, the SEC has maintained constant investigations into Mr. Musk’s speech, employing nebulous interpretations of the consent decree seemingly designed to curb and chill his future speech, all regarding speech entirely unrelated to the 2018 tweet for which the SEC initiated this action," Spiro wrote.
Spiro adds the SEC has threatened to hold the CEO of Tesla in contempt of court for such speech despite the luxury electric vehicle maker's compliance with the settlement. The brief calls on the Second Circuit Court of Appeals to strike or modify the pre-approval provision.
ELON MUSK'S TWITTER DEPOSITION RESCHEDULED TO OCT. 6, 7
The settlement with the SEC was reached to resolve securities fraud charges related to a now infamous tweet in which Musk claimed he had "funding secured" to take Tesla private at $420 per share. The agency filed a lawsuit against Musk claiming he made "false and misleading" statements about Tesla’s privatization plans and that he "knew or was reckless in not knowing" that his statements were false and/or misleading.
During the TED2022 conference in April, Musk maintained that funding to take Tesla private "was indeed secured" at the time and that he was "forced to concede to the SEC unlawfully" in order to save Tesla.
"At the time, Tesla was in a precarious financial situation, and I was told by the banks that if I did not agree to settle with the SEC that the banks would cease providing working capital, and Tesla would go bankrupt immediately. So that's like having a gun to your child's head," Musk explained. "So I was forced to concede to the SEC unlawfully. Those bastards. And now it makes it look like I lied when I did not, in fact, lie. I was forced to admit that I lied to save Tesla's life, and that's the only reason."