In a bold move, Elon Musk is asking a federal judge to throw out a lawsuit from the U.S. Securities and Exchange Commission (SEC) that accuses him of delaying the disclosure of his Twitter share purchases in 2022.
According to BNN Bloomberg, the case centers on allegations that Musk’s delayed reporting of his Twitter stake saved him $150 million while harming unsuspecting investors, prompting a legal battle over securities law violations and claims of regulatory overreach.
Musk, the billionaire entrepreneur behind Tesla and SpaceX, first came under scrutiny for his actions related to Twitter, which he later purchased and rebranded as X. In early 2022, Musk began acquiring shares in Twitter, eventually amassing a significant stake in the social media platform. Under federal securities laws, shareholders must disclose ownership of 5% or more of a company’s stock within 10 calendar days to ensure transparency for other investors.
Musk crossed this threshold but did not report his initial 5% stake in Twitter until April 4, 2022, when he disclosed owning 9.2% of the company. This filing came one business day after his wealth manager sought legal advice on the required disclosures, according to court documents. The SEC alleges that the 11-day delay allowed Musk to purchase over $500 million in shares at lower prices, saving him approximately $150 million.
The agency argues that this delay harmed other investors who sold their shares without knowing about Musk’s growing ownership, potentially missing out on higher prices. In January 2025, specifically on January 14, the SEC filed a lawsuit against Musk in the U.S. District Court for the District of Columbia, under case number 25-00105. The SEC is seeking to have Musk repay the $150 million in alleged savings and impose an additional civil penalty for violating public reporting rules.
Late on Thursday night, Musk filed a response in the Washington, D.C. federal court, urging the judge to dismiss the lawsuit. He contends that the delay in disclosing his stake was not intentional and caused no harm to investors. “There is no ongoing violation. There is no intent. There is no harm,” Musk stated in his filing.
In a separate court document filed on Friday, the SEC countered that Musk’s intent is irrelevant under federal securities laws. The agency insists that the violation of public reporting requirements is enough to hold him liable. This legal clash adds to a long history of tension between Musk and the SEC, dating back to a 2018 dispute over a tweet about taking Tesla private.
In that earlier case, Musk settled with the SEC by paying a $20 million fine and stepping down as Tesla’s chairman. He also agreed to have certain social media posts reviewed by Tesla lawyers before publication. The current lawsuit comes at a time when Musk has been vocal about his views on government oversight, often criticizing what he sees as excessive regulation.
“The SEC’s ‘selective enforcement’ of its securities laws ‘reveals an agency targeting an individual for his protected criticism of government overreach,” Musk argued in his recent filing. He further described the lawsuit as unnecessary, saying, “Simply put, this action is a waste of this court’s time and taxpayer resources.” This rhetoric underscores Musk’s broader frustration with regulatory bodies, a theme that has surfaced repeatedly in his public statements.
The timing of the SEC’s lawsuit, filed just six days before Republican U.S. President Donald Trump took office in January 2025, has also drawn attention. Trump later appointed Musk as an adviser on federal workforce and spending reductions, a role Musk held until announcing his departure from the Department of Government Efficiency in late May 2025. While this political backdrop is not directly tied to the legal merits of the case, it adds a layer of complexity to Musk’s ongoing battles with federal agencies.
Meanwhile, Musk’s Twitter journey did not end with his share purchases in 2022; he went on to acquire the entire company for $44 billion in October of that year. Renaming it X, Musk has since transformed the platform, aligning it with his vision for free expression and innovation. However, the SEC’s focus remains on the earlier disclosure delay, which it views as a clear breach of investor protection rules.
As the case unfolds, it will likely test the boundaries of securities laws and how strictly disclosure timelines are enforced. For Musk, a dismissal would mark a significant victory against what he perceives as regulatory overreach by the SEC. For the agency, holding Musk accountable could reinforce the importance of timely transparency in financial markets.
The outcome of SEC v Musk could have broader implications for how investors and companies navigate disclosure requirements. With billions of dollars in market value often at stake, the rules around timely reporting are critical to maintaining trust in public markets.
As both sides present their arguments, the federal court in Washington, D.C., will ultimately decide whether Musk’s actions warrant penalties or if his defense of an inadvertent delay holds up.