US SEC criticises Elon Musk for missing trial to attend SpaceX rocket launch, plans sanctions | Mint

The United States Securities and Exchange Commission (US SEC) has criticised Elon Musk for missing his trial over the 2022 acquisition of Twitter to attend a SpaceX rocket launch, Bloomberg reported, citing a filing in the San Francisco Federal Court.

The filing showed that Musk’s lawyer, Alex Spiro, informed the court that the tech billionaire missed the hearing on September 10 because he was at the Cape Canaveral launch site in Florida for a mission launch. The report added that Musk had previously ignored demands to complete a deposition in Los Angeles (LA), and the September date was set after US District Judge Jacqueline Corley ordered him to cooperate.

In May, Judge Corley directed Musk to appear again for an investigative deposition by the US SEC and warned him about delaying or rescheduling the testimony, barring any he “did not create and could not avoid”.

The case is called SEC v. Musk, at the US District Court, Northern District of California (San Francisco).

SEC Seeks Sanctions Against Musk for ‘Gamesmanship’

Three US SEC attorneys had flown into LA for the meeting, and the filing informed Judge Corley that the regulator now plans to seek sanctions against Musk for his “gamesmanship”, the report added.

SEC said the sanctions would require Musk to show cause for why he should not be held in civil contempt for waiting until three hours before the scheduled testimony to inform of him absence, as per a Reuters report.

“Musk’s excuse itself smacks of gamesmanship. The court must make clear that Musk’s gamesmanship and delay tactics must cease,” SEC lawyer Robin Andrews wrote, as per the Reuters report.

Bloomberg said Spiro did not immediately respond to their queries on this.

Musk At Rocket Launch Instead of SEC Meeting, Says Lawyer

“His obligations as Chief Technology Officer of SpaceX required he urgently travel to the East Coast yesterday for the high-risk Polaris Dawn launch,” Spiro stated, as per the filing on September 20, the Bloomberg report said.

He sought to explain that the launch timing was “unpredictable due to the weather” and that it was “important” for Musk to attend the launch to make a final decision about proceeding with the mission. The mission in question is the recently successful Polaris Dawn space flight, which completed the world’s first commercial spacewalk.

Reuters said Spiro called sanctions “drastic and unnecessary” as Musk’s was required at the launch as the astronaut’s lives depended on his presence, and it constituted an “emergency”. He added that the testimony has been rescheduled for October 3 adding that “there is no reason to believe such an emergency will reoccur”.

SEC Probe Against Musk

The regulator’s probe against Musk is regarding his purchases of Twitter stock and statements about his investments before he bought the social media platform for $44 billion. Twitter has been rebranded to X.

Investors and other Twitter shareholders alleged that the billionaire waited 10 days too long to disclose that he was buying the company shares. As per law, investors must disclose when they reach 5 per cent ownership of public companies. Musk eventually disclosed a 9.2 per cent Twitter stake and soon offered to buy the whole company.

Musk on his part has accused the SEC of “harrassing” him with summons.

(With inputs from Bloomberg and Reuters)