Elon Musk fended off 'gag order' aimed at silencing his views on fraud lawsuit by Tesla investors

Business Insider US
Tesla CEO Elon Musk. HANNIBAL HANSCHKE /Getty Images
Tesla CEO Elon Musk. HANNIBAL HANSCHKE /Getty Images
  • A group of Tesla shareholders are suing Elon Musk over his infamous "funding secured" tweet.
  • The shareholders asked a judge for a gag order to stop Musk talking publicly about the case.
  • In a ruling on Wednesday, the judge said the shareholders couldn't gag Musk.
  • For more stories go to

Tesla CEO Elon Musk, no stranger to speaking his mind, has fought off a proposed "gag order" that would have stopped him speaking publicly about a fraud lawsuit based on his infamous "funding secured" tweet.

Tesla CEO Musk tweeted in August 2018 that he had "funding secured" to take the electric automaker private. He later paid $20 million in a settlement with the US Securities and Exchange Commission, which said the tweet was "misleading."

A group of Tesla shareholders say in a lawsuit that Musk defrauded investors with the tweet, saying it was an "ill-conceived attempt to manipulate the stock price of Tesla upward in order to burn investors who had sold Tesla stock short."

The request for a gag order on Musk was filed by the shareholders' lawyers shortly after Musk discussed his "funding secured" tweet in a TED interview on April 14. During the interview, Musk said that "funding was actually secured."

In a filing Friday, seen by Insider, the shareholders' lawyers argue that Musk's comments to the media about the trial could "poison the jury pool" and influence its outcome. The trial is scheduled to begin in January 2023.

A filing submitted on Wednesday by Musk's lawyers, seen by Insider, says the proposed gag order would "trample on Elon Musk's First Amendment rights."

In a ruling published on Wednesday, Judge Edward Chen found in favour of Musk.

Chen said although the court has already ruled that Musk's 2018 claims that funding was secured were false, Musk's comments during his TED interview were consistent with arguments the Tesla CEO has already made in the shareholder suit.

Get the best of our site emailed to you every weekday.

Go to the Business Insider front page for more stories.