A U.S. district judge approved a $1.5 million settlement between the SEC and Elon Musk over his 2022 Twitter purchase, while expressing significant misgivings. Judge Sparkle Sooknanan said the settlement raised red flags, including the SEC filing an amended complaint just three minutes before the consent judgment motion and adding a revocable trust as a defendant, which appeared designed to let Musk say no relief was entered against him personally. The SEC had accused Musk of saving $150 million in closing costs by failing to disclose his growing stake in the $44 billion acquisition, making the penalty only 1% of that amount. Sooknanan noted her role was limited to ensuring the settlement did not make a mockery of judicial power, and she could not say it met that high threshold.
Tesla IncSettlement approved but judge raises red flags about SEC's process; no direct impact on Tesla operations.