Categories: U.S. News

Elon Musk Fails to Shift SEC’s Twitter Lawsuit Away from DC

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Elon Musk, the world’s wealthiest individual, attempted and failed to convince a federal judge in Washington, D.C., to relocate a Securities and Exchange Commission (SEC) lawsuit to Texas. The lawsuit pertains to Musk’s delayed disclosure of his growing stake in Twitter. His justification for the move was that his demanding schedule would make it difficult for him to defend himself in the nation’s capital.

U.S. District Judge Sparkle Sooknanan, in her ruling on Thursday, recognized and respected Musk’s busy schedule, yet pointed out that Musk, being a man of “considerable means,” spends at least 40% of his time outside Texas. “Indeed,” she noted, “Mr. Musk’s brief itself indicates that he has spent substantial time here this year,” referencing his tenure at the Department of Government Efficiency.

Judge Sooknanan contested that courts in Texas bear a heavier caseload than her own, and she could proceed with the case with “reasonable alacrity.” Musk had previously argued that litigating in Washington would impose “substantial burdens” on him due to work commitments that run up to 80 hours weekly.

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The SEC lawsuit, filed in January, accuses Musk of a delay in revealing his initial 5% Twitter stake in early 2022, which they contend allowed him to purchase more than $500 million of shares at artificially low prices. The SEC seeks a civil fine and the surrender of $150 million that Musk allegedly saved at the expense of unsuspecting investors. Musk is contesting these allegations and seeks to dismiss the case.

Musk resides in Austin, and his companies, Tesla, SpaceX, and the Boring Tunnel Business are all based in Texas. In an interesting turn of events, Judge Sooknanan also rejected Musk’s alternative proposal to move the SEC case to Manhattan, where former Twitter shareholders are currently litigating against him.

The case is SEC v Musk, U.S. District Court, District of Columbia, No. 25-00105.

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