Elon Musk’s Latest Tweet May Land Him Back in SEC Crosshairs

July 30, 2019, 10:34 PM UTC

Ah, Twitter, so tempting, so close at hand.

Tesla CEO Elon Musk may not be the most prolific tweeter, with 8,339 completed messages since 2007, according to his profile—he is running multiple companies, after all. But when it comes to his 27.6 million followers and his impact, the man is in a class by himself. And a tweet Monday night about production of solar roof tiles may have landed him and the company back in regulatory hot water.

Musk has had tweet wars with others, once accidentally publicized his cell phone number, and called a diver involved in the rescue of a Thai soccer team a “pedo.”

And then there was the unrealized claim of taking the company private, which set off an involved dispute with the SEC that resulted in a consent decree, $20 million-dollar fines for both Musk and Tesla, and Musk stepping down as Tesla chairman for three years.

The SEC decree was intended to keep Musk from affecting the company’s stock price through comments on social media. Among other things, he agreed not to mention “production numbers or sales or delivery numbers (whether actual, forecast, or projected) that have not been previously published via pre-approved written communications issued by the Company (“Official Company Guidance”) or deviate from previously published Official Company Guidance” without the “pre-approval of an experienced securities lawyer” employed by Tesla.

On Monday evening, he linked to a press release about the company’s “utility-scale energy storage—in other words, an aspect of its battery business. Journalist Ryan McCaffrey replied with the question, “How’s solar roof tile progress going? You were working on a new version (V3?) of that, right?.”

Within an hour, Musk responded, “Spooling up production line rapidly. Hoping to manufacture ~1000 solar roofs/week by end of this year.”

A Fortune review of the 10-Q financial filings for the first and second quarters of 2019 and of the 10-K for 2018 showed no production numbers for the Solar Roof product line.

Fortune contacted Tesla’s PR department to ask whether the tweet was cleared with a lawyer, but has not yet received an answer.

The challenge for Tesla is that the solar energy business is listed in financial filings as a division of the company.

“If that’s broken out as one of the business lines and he’s giving out numbers on the business line, that’s Tesla,” said Thomas Gorman, a partner at law firm Dorsey Whitney. ” If he was talking about something separate, like the Solar City business [that Tesla acquired in 2016]— we’re doing pretty good with the Solar City acquisition — that’s different.”

“This is not a great argument and if they go back to court, the judge will not be happy,” Gorman added. “I would not like to defend that argument.”

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