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Report: Elon Musk Rejected SEC Settlement, Triggering Complaint

The agency was reportedly ready to file the settlement Thursday when it got a call from Musk’s lawyers.

Tesla CEO Elon Musk’s attorneys reportedly rejected a settlement from the Securities and Exchange Commission on Thursday, prompting the agency to file a complaint in federal court in Manhattan. The Wall Street Journal reports the SEC was preparing to file a settlement with Musk that was “approved by the agency’s commissioners” on Thursday morning, but lawyers for Musk called the SEC and said they were “no longer interested in proceeding with the agreement.” The Journal reports Musk and his lawyers made a “last-minute” decision to “fight the case” rather than settle. After the call, the agency’s lawyers reportedly “rushed” to craft the complaint that was filed Thursday afternoon. In a statement Thursday night, Tesla and its board of directors said they were “fully confident in [Musk], his integrity, and his leadership.” The lawsuit seeks to bar Musk from “serving as an officer or director of any U.S. public company.” Tesla’s shares tumbled almost 10 percent after the complaint was filed.