Washington, D.C. - Attorneys for the U.S. Securities and Exchange Commission and Elon Musk are set to appear before a federal judge on Wednesday to argue for a $1.5 million settlement. The case stems from the SEC’s lawsuit accusing Musk of waiting too long to disclose his 5% stake in Twitter in April 2022, a delay that allegedly saved him $150 million. Musk purchased Twitter for $44 billion six months later.
U.S. District Judge Sparkle Sooknanan must determine if the settlement is fair to both sides, consistent with the public interest, and free of collusion. She has ordered both parties to propose a timeline for briefs supporting the deal.
The SEC sued Musk on January 14, 2025-just days before President Joe Biden left office. Musk, who has been an adviser to President Donald Trump, claims the lawsuit was politically motivated and that the disclosure delay was inadvertent. The Trump administration has since scaled back corporate enforcement, as SEC Chairman Paul Atkins refocuses priorities.
Former SEC enforcement chief Margaret Ryan left abruptly in March after clashing with agency leaders over enforcement direction. The settlement does not require Musk to admit wrongdoing or forfeit the money allegedly saved; however, the penalty is the largest in SEC history for this type of violation.