In the latest twist of the Securities and Exchange Commission’s (SEC) investigation into Elon Musk’s $44 billion acquisition of Twitter, now rebranded as X, a judge has ordered the Tesla and SpaceX CEO to testify for a third time. Magistrate Judge Laurel Beeler issued the order over the weekend, granting Musk, his legal team, and the SEC a week to agree on a date and location for the upcoming testimony.
The SEC’s fact-finding investigation revolves around the period leading up to Musk’s acquisition of Twitter, while the social media platform was still publicly traded. The regulatory body has clarified that, at this point, no conclusions have been drawn regarding the violation of federal securities laws.
During a court hearing in December, Judge Beeler had warned that she would issue an order if an agreement on the timing and location of Musk’s testimony couldn’t be reached. The recent order highlights that while an initial date was agreed upon, Musk did not appear, resisting the SEC’s subpoena on the grounds of the investigation being baseless and harassing, seeking irrelevant information.
Elon Musk contends that the SEC’s subpoena exceeds its authority, as it was not issued by an officer appointed by the President, a court, or the head of a department, as required by the U.S. Constitution. Despite Musk’s objections, the court is enforcing the SEC’s subpoena, deeming the testimony “not unduly burdensome” for the entrepreneur. The SEC had provided Musk the option to testify in Texas, where he resides.
This development comes after Musk closed the $44 billion deal to acquire Twitter and take it private in October 2022, following a protracted legal battle with the social media company’s previous leadership. Musk had initially tried to back out of the deal after signing the acquisition agreement in April 2022, prompting legal action from Twitter to compel him to proceed with the acquisition.
While Musk has already testified twice in this case, the judge’s recent order notes that the SEC has received “thousands of new documents” from various parties, including hundreds from Musk himself. As this legal saga continues, both the SEC and Musk’s representatives have yet to respond to inquiries for comments on this latest development. The ongoing investigation maintains its spotlight on the intersection of high-profile business transactions and regulatory scrutiny.