Posted on March 12, 2019 | by Maarten Vinkhuyzen
12 March, 2019 from Maarten Vinkhuyzen
SEC is trying to make the court hold Elon Musk in disrespect. The SEC claims that Musk has violated the agreement on the recognition of the guilt it has done since the scandalous "provision of funding" is a twisted agreement which was accepted by the court as its final decision and thus has the power to adjudicate on Elon Musk and Tesla.
This is very legal in the first paragraph of an article. For us simple non-attorneys, the important point of reference is: there is a court order that Musk and Tesla must observe.
SEC says Musk did not. Musk (and his lawyers) say he did so. In other words, we have a simple case of "he said," she said. "But when lawyers are concerned, it's never simple. See the 33 pages that lawyers needed to say, "Muscle is respected."
In the court order, there were a number of provisions concerning the independent directors, the presidency, the fines, the supervision and the communications. This complaint from the SEC concerns the provisions on communication and supervision. Simply put, these provisions say: Tesla must have policies and procedures for communicating material information, and Musk must comply with them.
Tesla has created policies and procedures that are not contested. According to Tesla and Muskus Muskus, he has observed them. Normally, this would be a "case closed". In his unlimited wisdom, however, the SEC believes that Musk has not complied with policies and procedures.
Let's rewind: What happened? On February 19, 2019, at 19:15, Elon Musk published something insignificant (intangible = it does not really matter). The fact that it is insignificant is not challenged by the SEC. Please do not discuss it in the comments.
The four hours were corrected or clarified. For some reason, someone from the Securities Committee believes that this may indicate that Musk does not comply with the court order. SEC asked Tesla what had happened, Tesla replied, but the SEC had more questions (on Sunday) and did not wait for the answers (next Monday) instead of complaining that Musk had violated the court order and had to be detained
What is important is that Tesla's court order and policy are around material information . For the information to be meaningful, there must be "a significant likelihood that disclosure … would be perceived by a reasonable investor by significantly altering the common set of available information."
Again, the SEC does not dispute the fact. that twitter is insignificant. She bases her complaint on the fact that she does not seek and does not receive a preliminary tweet. But for intangible tweets and communications no prior permission is needed. (Still dazed?)
Ah, says SEC, but to determine that it is truly immaterial, you must have a prior permission. It sounds logical until you start thinking. This is about all written communication . In fact, Musk needs prior authorization for any written communication, even internally. Musk can not write anything about Tesla without prior permission. And if he wants to repeat after more than two days, he needs permission again. This is a consequence of the SEC's interpretation.
After many legal arguments, Musk's lawyers say, "Musk never gave his consent and would not have agreed to such a broad order, and Tesla did not apply such a policy." 19659007] This is essential. The judgment is based on an agreement between two parties – SEC and Tesla / Musk. You can not change in a one-sided way such an agreement as SEC is trying to do here. And even if it was in order, it would not be valid because violates the US Constitution .
This leaves the question, what was the SEC's thought he rushed to file the complaint. She did not even wait for the answers to her own questions. It is very difficult to prove that there is "clear and convincing evidence that an unambiguous court has been violated", especially when people who have written "Tesla's senior communications policy" and have been accused of applying it say that the tweets are not in violation of politics .
In normal lawsuit, it will be his end. But in proceedings where the SEC is a party, the courts act differently. The defending party is no longer considered innocent until the guilt is proven beyond reasonable doubt. Rather, some believe that politics has become, in cases of the least doubt, the SEC is right .
If the result of this case is that there is a significant difference in opinion, there is a huge problem. The basis of each argument is that "the clear and unambiguous terms of the Court's order" are indeed clear and unambiguous. In Tesla's refutation of the SEC's arguments, SEC is accused of changing the meaning of the agreement.
If the judge is on SEC's side and said the SEC's interpretation is correct, the argument "Musk never agrees" puts the whole argument back to court. I can not wait for the sentence.