Musk Lawyer: Gag order would trample free speech rights | Economic news

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By TOM KRISHER, AP Auto Writer

DETROIT (AP) — Elon Musk’s attorney says a federal judge would violate the Tesla CEO’s right to free speech if he orders Musk to stop speaking about the 2018 tweets saying that he had the funding to make Tesla a private company.

In a court document filed Wednesday, attorney Alex Spiro says a motion by a group of Tesla shareholders seeking a gag order does not establish that Musk’s comments will harm the group of jurors likely to hear. the case.

Lawyers for the shareholders have argued that Musk was trying to sway potential jurors before the trial goes to trial on January 17 next year. They argue that the CEO’s August 2018 tweets were written to manipulate the stock price, costing shareholders money.

In court papers, shareholders say U.S. District Judge Edward Chen in San Francisco has already ruled that Musk’s statements about having the money to take Tesla private at $420 a share were false.

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They also allege that Musk violated an October 2018 court settlement with US securities regulators. Musk signed the agreement to pay a $20 million fine and not make any statement denying the securities fraud allegations. Musk is challenging the deal, saying it’s unconstitutional.

Spiro’s response comes about a week after Musk, the world’s richest person, made a controversial bid to take over Twitter and turn it into a private company with a bid of $43 billion equivalent to $54.20. per share. Twitter’s board on Friday adopted a “poison pill” strategy that would make buying the shares prohibitively expensive for Musk.

At issue is Musk’s April 14 interview at TED 2022, where he said he secured funding to take Tesla private in 2018. He called the Securities and Exchange Commission a layman and said that he had only settled the case because the bankers had told him they would stop providing capital if he did not, and Tesla, based in Austin, Texas, would have gone bankrupt.

Attorneys for the shareholders said Musk’s comments in the interview were an “unsubtle attempt to absolve himself in the court of public opinion” for the misrepresentations made with his August 7, 2018 tweets.

But Spiro wrote in his response that shareholders had failed to show that Musk’s speech presented a “clear and discernible danger” that the entire community would be corrupted by pre-trial publicity, or that it would be impossible to find 12 objective jurors.

Musk’s comments simply reiterated the case that is already on the public record in his SEC settlement challenge, Spiro wrote.

His motion indicates that Musk is in the midst of a Twitter takeover bid, which has led to a debate over free speech censorship. Journalists, he wrote, compared this to Musk’s previous statements about privatizing Tesla.

During the TED interview, Musk was asked if funding had been secured for the Twitter deal, a reference to Tesla tweets from 2018. “Mr. Musk should be allowed to respond meaningfully and honestly to requests like this, and not being forced to remain silent,” Spiro wrote.

If Musk violated the SEC agreement, the agency can ask a judge to overturn it and reinstate the securities fraud claim. The SEC would not comment.

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