The US Securities and Exchange Commission (SEC) is due to meet Elon Musk’s lawyers in a San Francisco court on Thursday in an attempt to make him testify again over the investigation into his $44 billion purchase of Twitter, Reuters reported.
In October, the SEC sued Musk to compel him to testify as part of an investigation into his 2022 purchase of social media giant Twitter, which he later renamed X. The agency is examining whether the Tesla and SpaceX owner complied with the law when filing required documents with the agency about purchases of Twitter stock, as well as whether his statements about the deal were deceptive.
The feud between Musk and the top US markets regulator dates back to 2018, when he tweeted that he had “funding secured” to take the electric car manufacturer private.
The SEC has been investigating Musk’s takeover of Twitter since April 2022, when he first disclosed acquiring company stock. At that time, the billionaire provided documents to the investigation and testified via video conference at two meetings in July of that year, according to the SEC’s records.
SEC attorneys stated that they had more questions for Musk after receiving the new documents and requested additional testimony in September, but Musk did not comply.
In response to the SEC’s October lawsuit, Musk’s lawyers called on US Magistrate Judge Laurel Beeler to dismiss the request, labelling the investigation misguided.
The SEC’s pursuit of Mr. Musk has crossed the line into harassment.
The commission denied Musk’s lawyers’ contention that separate SEC attorneys had no legal authority to subpoena testimony, arguing that agency officials had the authority to demand additional testimony as the investigation evolved.
The judge is expected to receive arguments from both sides on Thursday at a hearing scheduled for 9:30 a.m. Pacific Time (5:30 p.m. GMT). The SEC will have to prove that the investigation falls within its authority, complies with procedural requirements, and that the evidence it seeks is relevant and substantial.
Musk’s tweets also sparked a shareholder lawsuit, but a jury found in February that the X owner was not liable for misleading investors.
On 4 April 2022, Musk announced the acquisition of a 9.2% stake in Twitter. Initially, he indicated in the documentation that he planned to be a passive shareholder, meaning he had no intention of taking over the company.
However, later that month, he revealed plans to purchase Twitter for $44 billion. He subsequently tried to pull out of the deal, claiming that Twitter was not disclosing full information on bot activity on its platform.
After a lawsuit demanding that the deal must be finalised, Musk closed the acquisition of Twitter at the end of October 2022.
