Tesla Inc chief executive Elon Musk on Thursday taunted the US government regulators who threatened to oust him as CEO of the electric carmaker, just days after he settled a case alleging that he duped investors.
Musk used his Twitter account to jab at the Securities and Exchange Commission (SEC), the agency that went after him for an Aug. 7 tweet in which he declared that he had secured financing for a Tesla buyout.
The SEC said that Musk had not locked up the estimated US$25 billion to US$50 billion that it would have required to pull off such a deal and wanted to punish him by forcing him out as Tesla’s chief executive.
After initially rejecting an SEC offer to settle the case, Musk relented two days after the fraud complaint against him and agreed to resolve the matter by having Tesla and Musk each pay a US$20 million penalty, stepping down as Tesla’s chairman and submitting to oversight about his communications of company news.
However, the deal did not prevent Musk from continuing to speak out about other subjects — a liberty that he took advantage of to bash the SEC in a tweet showing that he is still stewing about the allegations filed against him.
Musk derided the SEC as the “Shortseller Enrichment Commission” before snidely praising it for “doing incredible work.”
The tweet also stoked Musk’s long-running feud with short sellers, a category of investors that have been betting on Tesla’s stock to fall.
Tesla shares declined by more than 2 percent to US$274.50 in extended trading after Musk’s tweet.
The SEC declined to comment on Musk’s tweet. Tesla did not immediately respond to requests for comment.
Musk’s barb at the SEC does not violate the settlement, because he did not explicitly criticize it as being unfair or unwarranted, said Peter Henning, a Wayne State University, Michigan, law professor who was formerly an SEC attorney.
“But it certainly shows his pique at having to settle,” Henning said. “This isn’t something you would expect from a mature corporate leader, but he is clearly still angry and was probably reluctant to settle.”
The SEC settlement still needs court approval.
US District Judge Alison Nathan on Thursday ordered the SEC, Musk and Tesla to file documents by Thursday next week explaining why the agreement is “fair and reasonable.”
Musk’s sarcastic tweet could cause Nathan to reject the settlement if it gives her reason to believe that he “has no intention or ability to change his conduct,” University of Michigan professor of business Erik Gordon said.
As part of Musk’s settlement with the SEC, Tesla is supposed to monitor its CEO’s Twitter posts, but only those that have to do with company news. However, that does not mean that Tesla’s board cannot order Musk to tone done his Twitter posting in the best interests of the company.
“Someone has to get a hold of his Twitter account and stop him,” Henning said.
NOT ALL GOOD: Analysts warned that other data for last month might be less rosy due to the virus and analysts expect the PMI to contract again next month Chinese factory activity saw surprise growth last month as businesses went back to work following a lengthy shutdown, but analysts said that the economy faces a challenging recovery as external demand has been devastated by the COVID-19 pandemic, while the World Bank said that growth could screech to a halt. China is slowly returning to life after months of tough restrictions aimed at containing the virus, which put millions of people into virtual house arrest and brought economic activity to a near standstill. The strict measures saw a closely watched gauge of manufacturing plunge to its lowest level on record in February,
ALL ABOUT STRATEGY: The company is optimistic, saying that its gross margin should increase year-on-year, but it is scaling back on its plans to expand capacity Quang Viet Enterprise Co (QVE, 廣越), which makes down jackets and garments for sportswear and outdoor brands including Adidas AG, yesterday said that revenue might drop 5 to 10 percent annually this year as some customers trimmed orders in response to the COVID-19 pandemic. That would mark its first revenue decline since 2016. Quang Viet posted record-high revenue of NT$16.26 billion (US$537.45 million) last year, up 22 percent from 2018. Down jackets made up 40 percent of it revenue last year. North Face Inc and Patagonia Inc are this year likely to reduce orders by 20 to 30 percent from a
ELECTRONICS Lite-On delays sale of unit Lite-On Technology Corp (光寶科技) yesterday said it would postpone the sale of its solid-state drives (SSD) business to Kioxia Holdings Corp, formerly known as Toshiba Memory Holdings Corp, due to disruptions amid the COVID-19 pandemic. Last year, the Taiwan-based electronics components supplier struck the deal with the Japanese firm, agreeing to sell the unit for US$165 million. Citing unfinished integration work due to the pandemic, Lite-On has deferred today’s closing date until further notice, adding that the delay would not have a negative effect on the unit’s operations. AUTO PARTS Hiroca approves dividend Automotive interior parts supplier Hiroca
Taipei 101, one of the nation’s leading shopping centers, is planning to reduce its business hours due to decreased demand amid the COVID-19 pandemic. Taipei 101 is to open daily at noon and close at 9pm from April 6, building management said in a statement on Monday. The shopping center has been opening at 11am and closing at 9:30pm from Sunday to Thursday, while closing at 10pm on Friday and Saturday. The restaurants in the food court — on the basement level — would adjust their business hours as necessary, but the supermarket would continue to open at 9am daily, management said. The shopping