Attorneys representing the U.S. Securities and Exchange Commission and Elon Musk are set to appear before a federal judge in Washington on Wednesday to defend a proposed $1.5 million settlement tied to Musk’s 2022 purchase of Twitter shares.
The settlement aims to resolve a lawsuit accusing Musk of failing to disclose on time that he had acquired more than a 5% stake in Twitter in April 2022. According to the SEC, the delayed disclosure allowed Musk to continue buying shares at lower prices, saving an estimated $150 million before eventually purchasing the platform for $44 billion later that year, News.Az reports, citing Reuters.
The case will now be reviewed by U.S. District Judge Sparkle Sooknanan, who said the court must determine whether the agreement is fair, serves the public interest, and is free from any improper collusion or corruption.
The judge has instructed both parties to appear in court and provide a timeline for filing briefs supporting the settlement.
The SEC originally filed the lawsuit on January 14, 2025, just days before former U.S. President Joe Biden left office. Musk, a former adviser to Donald Trump, has repeatedly claimed the case was politically motivated and said the delayed disclosure was accidental.
The proposed agreement does not require Musk to admit wrongdoing or surrender the profits he allegedly gained from the late filing. Still, a source familiar with the matter said the penalty remains the largest SEC fine ever imposed for this type of disclosure violation.
The case also comes as the SEC undergoes changes under Chairman Paul Atkins, whose leadership has reportedly shifted the agency’s enforcement priorities. Reuters previously reported that former SEC enforcement chief Margaret Ryan left the agency earlier this year after disagreements over the direction of enforcement policies.
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