Elon Musk has resolved the U.S. Securities and Exchange Commission’s civil lawsuit concerning the delayed disclosure of his initial Twitter acquisitions, now rebranded as X. A trust bearing Musk’s name will pay a $1.5 million US civil penalty as part of the settlement revealed in the Washington, D.C., federal court on Monday.
The agreement does not entail an admission of guilt from Musk, and he will not forfeit any of the purported $150 million saved due to the delay. Approval from U.S. District Judge Sparkle Sooknanan is necessary for the settlement, following his denial of Musk’s attempt to dismiss the case in February.
This resolution concludes over seven years of contentious disputes between Musk and the regulator, which commenced in September 2018 when the SEC accused him of securities fraud for claiming he had secured funding to potentially privatize his electric car company Tesla through a tweet.
Musk previously settled a case related to this incident by paying a $20 million civil fine, allowing Tesla’s attorneys to review select Twitter posts in advance, and relinquishing his position as Tesla’s chairman.
Musk’s lawyer, Alex Spiro, remarked in a statement, “Mr. Musk has now been cleared of all issues related to the late filing of forms in the Twitter acquisition, as we said from the outset he would be.” The SEC declined to provide a comment on the matter.
In the January 2025 lawsuit, the SEC contended that Musk’s 11-day delay in disclosing his initial five percent stake in Twitter in late March and early April 2022 enabled him to purchase over $500 million worth of shares at artificially reduced prices before eventually unveiling a 9.2 percent stake.
Musk justified the delay as unintentional and accused the SEC of infringing on his freedom of speech by singling him out. The lawsuit was filed six days before the end of former U.S. President Joe Biden’s term and the commencement of Donald Trump’s tenure. The current SEC Chairman, Paul Atkins, has been redirecting the agency’s enforcement priorities.
The $1.5 million penalty, though deemed a “modest sum for the richest person on the planet” by legal expert Robert Frenchman from the Dynamis law firm in New York, could serve as a deterrent against similar infractions by others.
Musk finalized the $44 billion acquisition of Twitter in October 2022, subsequently integrating Twitter into his artificial intelligence company xAI and then merging xAI into his space exploration company SpaceX. Forbes magazine values Musk at $789.9 billion.
A separate civil suit linked to Twitter is ongoing, distinct from the settled case. Both parties revealed on March 17 that they were in discussions to reach a resolution, following the abrupt departure of SEC enforcement chief Margaret Ryan on March 17 after just over six months in her role.
This separate lawsuit involves allegations of Musk defrauding Twitter shareholders by suggesting the platform was inundated with fake and spam accounts to alter the takeover terms. Shareholders claim Musk’s statements led to a decline in Twitter’s stock price, causing them financial losses. The damages sought in this case are estimated at $2.5 billion.
Musk’s lawyers, including Spiro, are seeking the dismissal of this case or a retrial, citing bias and prejudice against Musk as contributing factors to the verdict.
Despite overseeing various companies with interactions with the government and facing multiple regulatory investigations, Musk spearheaded cost-cutting efforts during the second Trump administration in early 2025 through the Department of Government Efficiency (DOGE) initiative before resuming his private sector endeavors later that year.
Recently, Musk testified for an extensive duration in federal court in Oakland, California, over a lawsuit concerning OpenAI, which he claims as his brainchild. Musk alleges that OpenAI deviated from its charitable objectives to become a for-profit entity and is demanding $150 million in damages, alongside the removal of Open AI co-founder Greg Brockman and CEO Sam Altman from the organization’s leadership.
