U.S. Judge Says Elon Musk Still Can’t Tweet Whatever He Wants

U.S. Judge Says Elon Musk Still Can’t Tweet Whatever He Wants

Elon Musk has once again lost a court battle over his right to shitpost unfettered. The 2nd U.S. Circuit Court of Appeals in New York City has rejected the billionaire’s bid to end his 2018 agreement with the Securities and Exchange Commission that mandates legal oversight on some of Tesla-related tweets.

Musk’s request to overturn the more than four year-old consent decree had already been struck down by one federal judge in New York District Court in April 2022. But the multihyphenate CEO filed an appeal, which was rejected Monday. In the new ruling, three additional judges have denied Musk’s bid to sidestep SEC oversight and accountability for his posts.

“We have considered Defendant-Appellant’s remaining arguments and find them to be without merit. Accordingly, we AFFIRM the judgment of the district court,” the three-judge panel wrote in their Monday filing. In accordance with this ruling, Musk is still required to have a Tesla lawyer review certain content he wants to post online, or face potential investigation and consequences.

Which means even owning Twitter hasn’t freed Musk from legal restrictions on his tweets. Though he may be Twitter CEO (at least for the next few weeks until Linda Yaccarino presumably takes his place), Musk remains beholden to powers even beyond that of “Chief Twit.”

Why Can’t Elon Musk Tweet Anything He Wants?

All of this dates back to a very stupid 2018 ‘420′ Twitter post that Tesla CEO Musk has claimed had nothing to do with weed. “Am considering taking Tesla private at $US420. Funding secured,” he notoriously posted on August 7, 2018. Except Tesla’s board and investors apparently hadn’t been been informed of the idea. A shitstorm ensued in which Tesla’s stock price skyrocketed, trading was halted, and the SEC stepped in. The federal watchdog’s investigation revealed that there was never any finalised deal to privatize Tesla in place. The SEC charged Musk with fraud.

As part of a settlement, the billionaire had to resign as Tesla Chairman (though kept his CEO position) and both he and the company were forced to pay out separate $US20 million fines. Also, Musk signed a consent decree intended to rein in any communications that could drastically alter Tesla’s stock price. Under the agreement, Musk’s Tesla operations-related tweets are supposed to be reviewed by company lawyer before he posts them.

Though Musk subsequently won his securities fraud case earlier this year, and a jury found him not liable to investors for their losses, the terms of the original settlement still stand.

Has Musk Changed His Twitter Habits?

Yet Musk has openly seemed to flout that requirement and continued to tweet rather indiscriminately. Two of his posts since the 2018 settlement have triggered additional investigation by the SEC (one in 2019 and one in 2021). At least one additional post has led to another federal agency investigating Musk. A 2019 deal reaffirmed the restriction on his social media communications. But he’s even continued to defend that original 420 post, and he’s continued to fight against the consent decree restrictions.

In 2022, his lawyer, Alex Spiro, claimed the SEC was attempting to “muzzle and harass” the billionaire by digging into specific posts. Spiro additionally said that the SEC’s oversight was “calculated to chill” Musk’s First Amendment rights.

What did the Judges Think?

Yet, according to the Monday ruling, the federal appeals judges don’t think the second richest man on Earth is being unfairly muzzled, harassed, or deprived of freedom.

“We see no evidence to support Musk’s contention that the SEC has used the consent decree to conduct bad-faith, harassing investigations of his protected speech,” the panel wrote. “Whether or not the consent decree may have ‘provide[d] broader relief than the court could have awarded after a trial’ does not detract from the SEC’s ability to enforce the agreement Musk voluntarily signed.”

Basically, through consent decrees, people are allowed to sign away some of their First Amendment rights. And Musk knowingly did so when he agreed to the SEC’s settlement terms. “Had Musk wished to preserve his right to tweet without even limited internal oversight concerning certain Tesla-related topics, he had ‘the right to litigate and defend against the [SEC’s] charges’ or to negotiate a different agreement — but he chose not to do so.”

Additional appeals from Musk’s legal team about changing conditions and common good also held little sway over the court. Spiro and Musk’s other attorneys attempted to argue that it was in everyone’s best interest for the consent degree to be adjusted, and that changes in “factual conditions” made the agreement more burdensome that it originally was.

But the judges pointed out that nothing in the law had shifted and that the public still probably benefits from some oversight of the CEO’s public communications regarding their companies.“The public interest [does not] require modification of the consent decree. If anything, it cuts in the other direction,” the panel wrote.

Yet Musk remains undeterred. To Reuters, Spiro wrote, “we will seek further review and continue to bring attention to the important issue of the government constraint on speech.”

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