Securities and Exchange Commission v. Musk

2023 WL 3451402 (2023)

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Securities and Exchange Commission v. Musk

United States Court of Appeals for the Second Circuit
2023 WL 3451402 (2023)

Facts

Elon Musk (defendant) entered into a consent decree with the Securities and Exchange Commission (SEC) (plaintiff) in an enforcement action, thereby agreeing to comply with the policy of Musk’s company, Tesla, regarding corporate communications. Tesla’s corporate-communications policy required Musk to obtain pre-approval from Tesla’s in-house counsel for all communications made via social media. The consent decree also required Musk to comply with reasonable requests from the SEC for evidence of Musk’s compliance with the corporate-communications policy. After Musk agreed to the consent decree, the SEC initiated investigations into Musk’s compliance with the corporate communications policy and issued subpoenas requiring Musk to provide information about various tweets Musk had made. Musk filed a motion pursuant to Federal Rule of Civil Procedure 60(b), seeking to modify or terminate the consent decree on the grounds that the SEC’s methods of enforcing the consent decree were unfair and done in bad faith. Musk also argued that the consent decree contained an unconstitutional prior restraint on Musk’s free-speech rights. The district court denied Musk’s motion. Musk appealed.

Rule of Law

Issue

Holding and Reasoning ()

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