Elon Musk Faces Federal Investigation

The social media company said in a court filing released Thursday that it is being investigated by federal officials for Elon Musk's behavior in the $44 billion takeover deal for Twitter Inc (TWTR.N).

While the filing says it's under investigation, it didn't specify what the exact focus of the investigations was and which federal officials were conducting them.

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Twitter Applied to the Court for the Incident

Twitter, which sued Musk in July to force Musk to close the deal, said attorneys for the Tesla Inc (TSLA.O) CEO claimed "research privilege" in refusing to hand over the documents he requested.

Twitter said in late September that Musk's lawyers had provided a "privilege record" identifying the documents to be kept. The diary cited drafts of the May 13 email sent to the U.S. Securities and Exchange Commission (SEC) and a slide presentation to the Federal Trade Commission (FTC).

“This 'hide the ball' game must end,” the company said in the court filing. The court filing, which asked Delaware judge Kathaleen McCormick to order Musk's lawyers to provide the documents, was filed Oct. That same day, McCormick halted the litigation between the two parties after Musk reversed course and said he would continue the settlement.

Musk's lawyer, Alex Spiro, told Reuters that Twitter's appeal to court is one; He said it was a "misdirection". And "those under federal investigation are Twitter's administrators," he said.

Twitter declined to comment on Spiro's statement. He also declined to comment when asked by Reuters if he understood any investigation into Musk.

The SEC did not immediately respond to a request for comment, and the FTC declined to comment. The SEC also stated whether Musk's 9% stake he created before announcing his offer was disclosed late, and why it aims to become a passive shareholder; questioned his comments about the Twitter acquisition, including Musk later reiterated the statement to indicate that he is an active investor.

In June, the SEC asked Musk in a letter whether he should amend his public filing to reflect his intention to suspend or abandon the deal. The Information, a technology news site, in April; He reported that the FTC is examining whether Musk complied with the antitrust reporting requirement regarding an investor's intentions to become a passive or active shareholder. However, Twitter is about to review the takeover deal with Musk in June by the FTC and the US Department of Justice; it said it cleared the antitrust waiting period.

McCormick gave Musk until October 28 to close the purchase. If the deal is not done by then, a trial date will be set for November.