SEC and Elon Musk Settle Lawsuit Over Twitter Stake Disclosure

U.S. Securities and Exchange Commission and Elon Musk agreed to settle a lawsuit filed by the regulator last year, accusing him of violating securities laws in the run-up to his 2022 purchase of Twitter. 5 million to the SEC.

The settlement requires sign-off by the judge presiding over the case. The SEC originally sought $200 million in the lawsuit. Alex Spiro, an attorney for Musk, stated: 'Mr. Musk has now been cleared of all issues related to the late filing of forms in the Twitter acquisition, as we said from the outset he would be.

Musk purchased Twitter for $44 billion in a leveraged buyout in late 2022. He later changed the name of Twitter to X. Musk merged X with his artificial intelligence company xAI and then with SpaceX earlier this year.

Prior to the purchase, Musk built up a position of greater than 5% in Twitter, which was publicly traded. Musk was required to disclose his holdings to the public within 10 calendar days of reaching the 5% threshold. However, Musk was late in filing the disclosure of his Twitter stake.

In a court filing last month, the SEC revealed it was engaged in discussions of a potential resolution with Musk. The SEC said in its initial complaint that Musk's failure to disclose his stake allowed him to buy shares at 'artificially low prices,' putting other investors at a disadvantage, according to a CNBC report.

In March, a jury in a federal court in California found that Musk had misled Twitter investors in the run-up to his Twitter buyout in a separate class action trial.

Musk's attorneys stated after the March verdict that they planned to appeal. Elon Musk has a net worth of roughly $790 billion, according to Forbes. Musk is CEO of Tesla and SpaceX. The agreement follows a prior settlement between Musk and the SEC in 2018 involving Tesla and Musk's aborted efforts to take the automaker private.