Tesla Inc. CEO Elon Musk and the board of the electric-vehicle firm have been sued by a shareholder who accused Musk of violating his 2018 settlement with the U.S. Securities and Trade Fee over his Twitter use.
In line with a grievance unsealed late Thursday in Delaware Chancery Court docket, Musk’s “erratic” tweets, together with a put up final Might 1 that Tesla’s inventory worth was “too excessive,” and the failure of Tesla’s board to observe his compliance with the SEC settlement have uncovered shareholders to billions of {dollars} of losses.
Tesla didn’t instantly reply to a request for remark.
The SEC settlement stemmed from Musk’s August 2018 tweet that he was contemplating taking Tesla personal and had “funding secured” for a potential $72 billion transaction.
He and Tesla every agreed the next month to pay $20 million in civil fines to settle with the regulator, and Musk agreed to have Tesla attorneys vet a few of his tweets prematurely.
The shareholder lawsuit stated Musk has continued issuing tweets with out the required advance approval. It seeks to have Musk and different Tesla administrators pay damages to the corporate for breaching their fiduciary duties.