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Elon Musk has agreed to pay $1.5 million to resolve a United States government lawsuit accusing him of violating stock disclosure rules during his 2022 acquisition of Twitter, now known as X.
The agreement, filed in a federal court in Washington, still requires judicial approval. Under the terms, a trust linked to Musk will pay the penalty over what regulators said was a delayed disclosure while he accumulated shares ahead of the $44 billion takeover.
The case centred on rules enforced by the Securities and Exchange Commission requiring investors to report when they surpass a five per cent stake in a publicly traded company within 10 days.
Regulators said Musk missed that deadline by 11 days, allowing him to continue buying shares at lower prices, moves they estimated saved him about $150 million.
Musk’s lawyer, Alex Spiro, framed the outcome as a vindication, saying his client had effectively been cleared of wrongdoing and maintained that the agreement did not amount to a settlement because Musk had done nothing improper.
He added that the payment relates only to a delayed filing by a trust entity.
“A trust vehicle has agreed to a small fine for being late on one filing,” Spiro said.
In an email to AFP, Spiro added that the deal with the US government was not a settlement “because he did nothing wrong.”
“The case against him was dismissed,” Spiro said.
The deal does not require Musk to return any of the alleged gains. Instead, the trust agreed to pay the fine and commit to complying with disclosure rules going forward, without admitting liability.
The SEC said it had amended its complaint to include the trust as a defendant and would drop the case against Musk personally once the court approves the agreement.
The lawsuit was initially filed shortly before former US President Joe Biden left office. Musk, who had ties to Donald Trump at the time, had attempted to have the case dismissed, but a judge rejected that request earlier this year.
The development comes after a separate case in California, where a jury found in March that Musk misled investors during the 2022 takeover, with potential damages estimated at up to $2 billion. His legal team has indicated plans to appeal.
This marks the second time Musk has reached an agreement with the SEC. In 2018, he paid $20 million and stepped down as chairman of Tesla following claims he had secured funding to take the company private, an effort that did not materialise.
