Comparing Eminem’s case with SEC and Elon Musk’s battle, Tesla lawyers stated that “the First Amendment requires that agencies proceed with caution when constitutional rights are at stake, not seek to pursue any and all novel theories that broaden their authority at the cost of individual freedom.”
As the battle between Tesla Inc (NASDAQ: TSLA) CEO Elon Musk and the US Securities and Exchange Commission (SEC) continues, the billionaire makes further attempts to abandon a 2018 agreement with the regulatory watchdog that requires Tesla lawyers to approve many of his tweets before posting them. In the latest filing submitted to a Manhattan federal court on Tuesday, Musk cited the 2002 song “Without Me” by rapper Eminem. The filing states that “The [SEC] won’t let me be or let me be me so let me see / They tried to shut me down…”, with the SEC replacing the FCC (Federal Communications Commission).
Notably, the song was a reference to a 2002 penalty that the Federal Communications Commission handed out to a Colorado radio station for playing Eminem’s 2000 song “The Real Slim Shady” which contained themes and lyrics that the FCC considered offensive.
Comparing Eminem’s case with SEC and Elon Musk’s battle, Tesla lawyers stated that “the First Amendment requires that agencies proceed with caution when constitutional rights are at stake, not seek to pursue any and all novel theories that broaden their authority at the cost of individual freedom.”
In addition to citing Eminem, Elon Musk also argued that the SEC had issued its subpoena in bad faith. He called SEC’s efforts a “fishing expedition” of harassing him. He said:
“The Formal Order is not an open invitation for any fishing expedition the Commission may wish to pursue, and the Commission errs in assuming that a court may not look behind its veil. To that end, the SEC twice denies that ‘its subpoenas are issued under the consent decree,’ instead stating unequivocally ‘the subpoenas were issued under the authority granted by the Formal Order of Investigation’.”
The SEC did not provide any comments yet.
Elon Musk and SEC Battle
Back in 2018, Musk tweeted that he was taking Tesla private at $420 per share. However, it did not happen, and as a result, the SEC charged the billionaire with misleading investors. The parties settled the charges and made an agreement on pre-approval of Musk’s tweets by lawyers before posting them. Now, Musk is trying to abandon the subpoena, stating that the SEC is “harassing” him and Tesla. Besides, recently, he said that Twitter fails to “adhere to free speech principles fundamentally undermines democracy.” Therefore, he is considering the launch of his own social media platform.
Along with the court filing, Tesla has also filed an application with the SEC regarding its proposed stock split in the form of a stock dividend. According to the filing, the company “announced its plan to request stockholder approval at the upcoming 2022 Annual Meeting of Stockholders (the “Annual Meeting”) for an increase in the number of authorized shares of common stock through an amendment to the Company’s Amended and Restated Certificate of Incorporation (the “Amendment”) in order to enable a stock split of the Company’s common stock in the form of a stock dividend.”
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