| 14 July 2024, Sunday |

Elon Musk’s growing legal challenges

Elon Musk was sued by the U.S. securities regulator related to his takeover of Twitter, the latest court battle against the billionaire whose empire spans electric carmaker Tesla (TSLA.O), space startup SpaceX and brain-chip startup Neuralink.

Below is a list of Musk’s legal entanglements.


The U.S. Securities and Exchange Commission has sued Musk to compel the world’s richest man to testify as part of a probe into his $44 billion takeover of social media giant Twitter, a court filing on Oct. 5 showed.

The SEC had said in May 2022 that it was looking into Musk’s disclosures about his stake in company. Around the same time, Twitter investors had sued Musk, claiming he manipulated the company’s stock price by failing to disclose in March 2022 that he was amassing shares in the platform now known as X.

X was sued in federal court in Florida on Oct. 2 by a legal-marketing company that claims the social media firm’s new name infringes its trademark incorporating the letter “X.”


A ruling is also expected soon following a non-jury trial challenging Musk’s $56 billion pay at Tesla.

In the closing arguments in February, a judge pressed lawyers for Tesla directors and the investor challenging Musk’s pay over whether the company’s explosive growth outweighed misleading disclosures about the pay plan in 2018.


Musk’s major companies Tesla, SpaceX and the X social media platform are embroiled in several legal disputes alleging age, gender or race-based discrimination.

SpaceX was hit in October by a proposed class action lawsuit filed by a former female employee who claims the firm promotes women and minorities less often than white men. The space startup was also sued by the U.S. Justice Department in August for allegedly discriminating against asylum recipients and refugees in hiring.

X faces a lawsuit accusing the company of disproportionately laying off older workers after Musk acquired it last year. A California federal judge refused to dismiss the case.

Tesla and Musk are defending numerous allegations of workplace harassment and discrimination, including lawsuits by California’s Department of Civil Rights and by a federal civil rights agency.

In April, a federal jury in San Francisco ordered Tesla to pay $3.2 million to a Black elevator operator who won a racial harassment lawsuit.

Tesla has said it does not tolerate discrimination and has taken steps to address workers’ complaints.


Musk’s tweets on the social media platform that he now owns has often courted controversy and been the subject of legal trouble.

In March, a U.S. appeals court upheld a decision by the U.S. National Labor Relations Board and said Musk violated federal labor law by tweeting that Tesla employees would lose stock options if they joined a union.

In February, a U.S. jury found Musk and Tesla were not liable for misleading investors when the billionaire tweeted in 2018 that he had “funding secured” to take the electric car company private.

The same tweet led to allegations of security fraud by the U.S. SEC and a 2018 settlement under which Musk stepped down as Tesla chairman, paid fines and agreed to get a lawyer’s approval for some of his tweets before posting them.

Musk now plans to ask the U.S. Supreme Court to consider whether the SEC overstepped its authority in enforcing a consent decree, as part of the 2018 settlement, that he has called a “muzzle” on his free speech.

The settlement with SEC had lead to the creation of a “fair fund” under which a $41.53 million payout will be given to investors who lost money due to the Musk tweet, a federal judge said in September.


Tesla is facing a lawsuit alleging its Autopilot system caused a fatal crash of a Tesla Model 3 that killed one person and injured two other passengers, according to documents filed in California state court.

An attorney for Tesla, in the first U.S. trial over allegations that its Autopilot feature led to a death, however, said the crash was the result of “a classic human error.”

The company had won a bellwether trial in Los Angeles in April over a Tesla crash related to its Autopilot feature with a strategy of saying that it tells drivers that its technology requires human monitoring, despite the Autopilot name.


Manhattan federal prosecutors are probing Tesla’s use of company funds on a secret project described internally as a house for Musk, the Wall Street Journal reported in August, citing people familiar with the matter.


A lawyer for former U.S. President Donald Trump on Oct. 4 asked a U.S. appeals court to revive his lawsuit claiming that X violated his and other users’ free-speech rights when it suspended their accounts. The case was dismissed last year.


Musk was accused in June of insider trading in a proposed class action by investors who allege he manipulated the cryptocurrency Dogecoin, costing them billions of dollars.

In a filing in Manhattan federal court, investors said Musk used Twitter posts, online influencers and publicity stunts like his 2021 appearance on NBC’s “Saturday Night Live” to trade profitably at their expense through several Dogecoin wallets that he or Tesla controls.

  • Reuters