May 7, 2019

Tesla Tweets: Who Will Bell the Cat?

As Liz blogged last week, the SEC & Tesla resolved their latest bit of unpleasantness late last month. The revised settlement gets pretty granular about what types of information Musk has to run by an “experienced securities lawyer.”

Statements that need to be run by this lawyer include those addressing the company’s financial results, including earnings of guidance, potential M&A activity, production, sales & delivery information, new business lines, previously undisclosed projections about the company’s business, and information relating to “events regarding the Company’s securities,” including Musk’s own transactions in them.

The settlement’s reference to the need to run all this past an “experienced securities lawyer” raises the question of “who will bell the cat?”  According to this story, that particular position hasn’t been filled yet.  I bet.  It’s not exactly a plum assignment.  After all, here’s what I think is a pretty realistic summary of the job description:

“The position involves telling our supervillain CEO who tweets at all hours and at a Trumpian pace that he can’t say what he wants to say on a regular basis. Oh, and just so you know, it’s entirely possible that he’ll  be baked out of his gourd when you’re called upon to try to talk him into putting down his phone.  Thoughts & prayers!”

And when Elon inevitably does fire off a non-compliant tweet, who wants to sign-up to be on the receiving end of the fire-breathing telephone calls from the Division of Enforcement, the Tesla board – and just maybe a federal judge?

Putting aside the job’s inherent undesirability, what makes anybody think that some lawyer is going to have any more success in keeping Elon’s fingers off the keyboard than his board, the plaintiffs’ bar and the SEC have had?  Yeah, this is not gonna end well. . .

Quick Poll:  How Does the SEC v. Musk Saga End?

Please take part in this anonymous poll on how the SEC v. Musk situation plays out.

bike tracks

Tomorrow’s Webcast: “M&A Stories – Practical Guidance (Enjoyably Digested)”

Tune in tomorrow for the webcast – “M&A Stories: Practical Guidance (Enjoyably Digested)” – to hear Mayer Brown’s Nina Flax, Baker Bott’s Sam Dibble, Shearman & Sterling’s Bill Nelson and our own John Jenkins share M&A “war stories” designed to both educate and entertain.

John Jenkins