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(Reuters) -Tesla Inc Chief Executive Elon Musk on Tuesday asked a judge in Manhattan to terminate a 2018 consent decree with the U.S. Securities and Exchange Commission (SEC) stemming from Musk’s 2018 Twitter (NYSE:TWTR) post about a potential buyout of Tesla (NASDAQ:TSLA).
“I never lied to shareholders. I would never lie to shareholders. I entered into the consent decree for the survival of Tesla, for the sake of its shareholders,” Musk told U.S. District Judge Alison Nathan in a court filing.
Musk also asked Nathan to quash portions of an SEC administrative subpoena. Musk’s lawyers said the consent decree allowed the SEC’s “roving and unbounded investigations into Mr. Musk while imposing” restraints on his “exercise of his (U.S. Constitution) First Amendment rights” to free speech.
The SEC did not immediately respond to a request for comment.
The SEC sued Musk in August 2018 after he wrote on Twitter that he had “funding secured” to potentially take his electric car company private at $420 per share. In reality, a buyout was not close.
Tesla and Musk settled by agreeing to each pay $20 million in civil fines, and to let Tesla lawyers vet some of Musk’s communications in advance, including Twitter posts that could affect Tesla’s stock price. Musk also gave up Tesla’s chairmanship.
Musk said in his new court filing that he withdrew his consent to settle in September 2018 after he learned that the SEC decree could require his companies Tesla, SpaceX, the Boring Company and Neuralink “to either seek a publicly accessible waiver letter regarding the SEC’s allegations or risk their future ability to raise money” through some offerings.
That prompted the SEC to file a complaint.
Musk added that after he learned from Tesla’s investor relations team that several of the company’s largest shareholders “could cede their ownership in Tesla – substantially impacting Tesla’s financing – if the case was not settled expediently,” which he said prompted him to settle.
He said the decision was made in order to assure “immediate survival of Tesla.”
Musk and Tesla last month accused the SEC of harassing them with an “endless” and “unrelenting” investigation to punish Musk for being an outspoken critic of the government.
