Supreme Court upholds restrictions on Musk's Tesla-related social media posts
What's the story
The US Supreme Court has upheld a settlement that mandates Tesla CEO Elon Musk to seek prior approval for certain social media posts about Tesla. The court dismissed Musk's appeal on Monday, affirming the lower court rulings without additional commentary. Musk had contended that this requirement constituted a "prior restraint" on his speech, infringing upon his First Amendment rights.
Tweet fallout
Origin of Musk's social media controversy
The case originated from a series of 2018 tweets by Musk, where he stated he had secured funding to make Tesla a private company. These posts led to a significant increase in Tesla's share price and temporarily halted trading. However, it was later revealed that the funding had not been secured, and Tesla continues to be a publicly-traded company.
SEC agreement
Musk's settlement with the Securities and Exchange Commission
As part of a settlement with the Securities and Exchange Commission (SEC), Musk was required to have his posts on Twitter, now known as X, pre-approved by a Tesla attorney. The agreement also necessitated Musk and Tesla to pay civil fines over the tweets where he claimed he had "funding secured" to privatize Tesla at $420 per share. The SEC accused Musk of violating antifraud provisions of securities laws with his tweets about taking Tesla private.