A Manhattan court is set to decide whether Elon Musk’s tweets were in violation of his October 2018 settlement with the SEC.
Lawyers from the U.S. Securities and Exchange Commission along with those representing Tesla’s CEO Elon Musk are slated to square off in a Manhattan courtroom next week over whether Musk should be held in contempt of court over his tweets.
U.S. District Judge Alison Nathan scheduled oral argument on an SEC contempt motion for April 4 at 2 p.m. EDT (1800 GMT), following both sides saying there is no need for an evidentiary hearing.
The SEC has accused Musk of violating his October 2018 settlement with the regulator by tweeting on February 19, to his 24 million plus followers on Twitter that Tesla could build around 500,000 vehicles in 2019.
According to the SEC, that tweet was improper since Musk did not get advance approval for the same from Tesla.
According to Musk’s lawyers, the tweet was not material; it merely restated Tesla’s target which he had earlier discussed publicly in January 2019.
John Hueston, a lawyer for Musk, did not immediately respond to requests for comment.
The SEC did not immediately respond to a request for comment.
According to legal experts, a contempt finding could subject Musk to a higher fine, as well as further restrictions, or even removal from Tesla’s board or as its chief executive.
Tesla shares closed Tuesday up $7.35, or 2.8 percent, at $267.77 on the Nasdaq.
The case is SEC v Musk, U.S. District Court, Southern District of New York, No. 18-08865.