Elon Musk has been sued by the U.S. Securities and Exchange Commission (SEC) over his acquisition of Twitter.
The SEC alleges that Musk failed to disclose his ownership of Twitter stock in a timely manner in early 2022, which allowed him to underpay by at least $150 million for shares he bought after he should have disclosed his ownership of more than 5% of Twitter’s shares.
Musk began amassing Twitter shares in early 2022 and by March of that year, he owned more than 5%. According to the complaint, he was required by law to disclose his ownership but failed to do so until April 4, 11 days after the report was due.
Musk’s lawyer, Alex Spiro, called the lawsuit a “sham” and an “admission by the SEC that they cannot bring an actual case”.
After Musk signed a deal to acquire Twitter in April 2022, he tried to back out of it, leading the company to sue him to force him to go through with the acquisition.
The SEC authorized an investigation into whether any securities laws were broken in connection with Musk’s purchases of Twitter stock and his statements and SEC filings related to the company.
The SEC’s current chair, Gary Gensler, plans to step down from his post on January 20, and it is unclear if the new administration will continue the lawsuit.
