Tesla Inc. CEO Elon Musk attends the World Artificial Intelligence Conference (WAIC) on August 29, 2019 in Shanghai, China.
Aly Song | Reuters
Elon Musk said in court on Wednesday that he doesn’t want to be the CEO of any company.
He recently took over the social media giant Twitter and appointed himself CEO, complementing his responsibilities as CEO and “technoking” of the electric vehicle manufacturer Teslaand CEO and CTO of the US defense company SpaceX.
Musk also confirmed that the deal on Twitter is temporary. “I expect to cut back on my time on Twitter and eventually find someone to run Twitter,” he said.
Musk and Tesla are in the midst of a Delaware court case over the 2018 CEO pay package the company gave him, an unprecedented compensation plan that made Musk a centi-billionaire and the richest person on earth.
Shareholder Richard J. Tornetta has sued Musk and Tesla because CEO compensation was excessive and Tesla’s board approval was a breach of their fiduciary duty.
Musk explained during testimony that CEO isn’t necessarily an apt description of the work he claims to do at his companies.
“At SpaceX, I’m really responsible for engineering the rockets and Tesla for the technology in the car that makes it successful,” Musk said. “So the CEO is often thought of as some kind of business-oriented role, but really my role is much more that of an engineer who creates technology and makes sure that we develop breakthrough technologies and that we have a team of incredible engineers who achieve something can do those goals.”
He also said: “In my experience, great engineers only work for great engineers. That’s my first duty, not the CEO’s.”
Tornetta’s attorneys asked Musk about a CNBC report that he authorized at least 50 Tesla employees, mostly Autopilot engineers, to help with his work at Twitter now that he owns the social media company.
Musk said he only asked Tesla employees to support him on Twitter “on a voluntary basis” and to work on Twitter “after hours.” He said no Tesla board member called him to say it wasn’t a good idea to use Tesla resources for any of his other privately held companies.
“That was after hours – just if you’re interested in an evaluation, help me evaluate the Twitter technique… that would be nice. I think it lasted a few days and it was over.”
When a lawyer asked if he thought it was a good idea to use Tesla assets on Twitter, Musk replied, “I hadn’t considered using Tesla assets.” He added, “The company employs 120,000 people.
With all of his business commitments, Tesla has taken more time than anything else in recent years, Musk said during testimony.
Attorneys for the plaintiffs questioned whether it was a good idea for Musk to take a combative stance against regulators, specifically asking him about previous insults he had championed at the Securities and Exchange Commission.
“In general, I think the SEC’s mission is good, but the question is whether that mission is well executed,” he replied.
“In some cases, I think that’s not the case. The SEC doesn’t investigate things that they should and pays far too much attention to things that aren’t relevant. The recent FTX thing I think is an example of that. Why wasn’t she given any attention? to FTX? Investors have lost trillions. Yet the SEC continues to pursue me even as shareholders are heavily rewarded. That makes no sense.”
In fact, the SEC and several other regulators have reportedly launched investigations into collapsed crypto company FTX, but it’s not clear if those investigations began before the company’s sudden bankruptcy last week.
What “SEC” stands for
The SEC had accused Tesla and Musk of making “false and misleading” statements to shareholders when Musk announced on September 8, 2018 that he was considering privatizing the automaker for $420 a share and had “secured the financing.” .
Tesla shares rose over 6% in price following Musk’s tweets, and trading halted on the same day. Tesla shares remained volatile for weeks after the incident.
As part of a settlement agreement, Tesla and Musk agreed to pay a $20 million fine, Musk had to step down from his role as Tesla CEO for three years, and agreed not to plead innocence or to contest the SEC’s allegations. Musk and Tesla also pledged to have the CEO’s tweets reviewed by a securities attorney prior to publication if they contained material business information that could affect Tesla’s stock price.
Tornetta’s attorneys asked Musk if he had a securities attorney review all of his tweets about Tesla and why he had maintained his innocence, including in press interviews. Musk seemed to acknowledge that he doesn’t have all of his Tesla-related tweets run by a lawyer first.
And he said: “The consent decree was made under duress. An agreement made under duress is not valid as a legal basis.”
At a time when Tesla stock was in a massive upswing, Musk had written in a July 2, 2020 tweet, “SEC, three-letter acronym, middle word is Elon’s.” The message was widely misinterpreted as having a vulgar meaning and read as a serious insult to the agency.
On Wednesday, attorneys in the Delaware court questioned him about the tweet, and Musk claimed it was widely misunderstood. The Tesla CEO told the court that by the initials he meant “Save Elon’s Company,” but the tweet was “interpreted differently.”