Musk seeks to end SEC ‘muzzle’ requiring pre-approval of tweets

(Reuters) — Elon Musk’s lawyers urged a federal appeals court to throw out a provision in his 2018 consent decree with the U.S. Securities and Exchange Commission requiring a Tesla Inc. lawyer to vet some of his posts on Twitter.

In a brief filed late Tuesday with the 2nd U.S. Circuit Court of Appeals in Manhattan, lawyers for Mr. Musk called the pre-approval mandate a “government-imposed muzzle” that inhibited and chilled his lawful speech on a broad range of topics.

They also said the requirement violated the U.S. Constitution and undermined public policy by running “contrary to the American principles of free speech and open debate.”

The SEC declined to comment on Wednesday. It is expected to file its own brief with the appeals court.

Mr. Musk wants to overturn part of an April 27 decision by U.S. District Judge Lewis Liman that rejected his bid to throw out the consent decree altogether.

Judge Liman said Mr. Musk's arguments amounted to a “bemoaning” of requirements he no longer wanted to adhere to now that “his company has become, in his estimation, all but invincible.”

The decree resolved a lawsuit accusing Mr. Musk of defrauding investors with a Aug. 7, 2018, tweet that he had “funding secured” to take his electric car company private, though a buyout was not close. Mr. Musk has said the tweet was truthful.

In settling, Mr. Musk agreed to let a Tesla lawyer screen tweets that might contain material information about the company.

Mr. Musk and Tesla each also paid $20 million in civil fines, and he gave up his role as Tesla chairman.