Musk seeks dismissal of SEC lawsuit on his 2022 Twitter stake

BillionaireElonMuskfiled a motion on Thursday to dismiss the U.S.Securities and Exchange Commission’s civillawsuitthat accused him of waiting too long in2022to revealhislargestakein social media platformTwitter, later renamed as X.

In a complaint filed in Washington, D.C. federal court in January, the SEC said Musk violated federal securities lawby waiting 11 days too long to disclosehisinitial purchase of 5% ofTwitter’s common shares. It sought to forceMuskto pay a civil fine and give up profits that theSECsaid were a result of the violations.

Lawyers forMusksaid on Thursday the billionaire stopped purchasing additional shares of then-publicly-listedTwitterand filedhisdisclosure one business day afterhiswealth manager consultedsecurities disclosure counsel about potential filing requirements.

AnSECrule requires investors to disclose within 10 calendar days when they cross a 5% ownership threshold,which would have been by March 24,2022,inMusk’s case.

TheSECsaid that at the expense of unsuspecting investors,Muskinstead bought more than $500 million ofTwittershares at artificially low prices before finally revealinghispurchases on April 4,2022, by which time he owned a 9.2%stake.

TheSECsuedMuskon January 14, six days before Republican PresidentDonald Trumptook office and madeMuska special adviser to slash the federal workforce and spending.

Muskfaced a deadline to respond to the court by Friday.

Musk’s lawyers said the case should not have been brought, and the billionaire did not mean any harm. They said theSEC’s action againstMusk”reveals an agency targeting an individual forhisprotected criticism of government overreach.”

“TheSECdoes not allege that Mr.Muskacted intentionally, deliberately, willfully, or even recklessly… Rather, theSECalleges that Mr.Musklate-filed a single beneficial ownership form three years ago, and fully corrected any alleged error immediately upon its discovery. There is no ongoing violation,” the Teslaand SpaceX CEO’s lawyers said.

TheSECdid not respond to a request for comment outside regular business hours.

Muskhas long feuded with theSEC, including after it sued him in 2018 overhisTwitterposts about possibly taking Tesla private and havingsecured funding to do so.