So over the weekend the Musk/SEC thing actually resolved, and I want to talk about the one detail that's been rattling around my head since Saturday: Tesla now has to find someone to police Elon's tweets. Not "monitor." Not "suggest." The settlement literally requires the company to put "additional controls and procedures" around his communications, tweets included, before they go out.
Quick recap for anyone who was offline this week (lucky you): back on August 7th Musk tweeted that he had "funding secured" to take Tesla private at $420 a share. That number alone should've tipped everyone off, but apparently it didn't, because the stock spiked and the SEC eventually decided it wasn't a joke, it was securities fraud. They sued him Thursday, September 27th, seeking to ban him from running any public company ever again. Two days later, Saturday the 29th, it was over. Settled. No admission of wrongdoing, which is standard in these things, but the terms are real: Musk steps down as Tesla's chairman for at least three years, though he keeps the CEO chair. He and Tesla each pay a $20 million fine, so $40 million total, which sounds enormous until you remember Musk's net worth was somewhere north of $20 billion at the time. That fine is a rounding error. A parking ticket with extra zeroes.
The part that actually interests me is the tweet oversight clause, because I don't think anyone involved has thought through how that's supposed to work in practice. Is there going to be a lawyer sitting next to him at 1am reviewing drafts before he hits send? Does "funding secured" get run past legal counsel, or does it just apply to stuff that could move the stock price, in which case who's making that call in real time? I've read a few different lawyers' takes on this today and even they don't agree on what "reasonable" oversight looks like here. My guess, and this is just a guess, is that it gets treated pretty loosely until something goes wrong again, and then everyone acts surprised.
I'll admit I've got a personal soft spot for this story because I spent an embarrassing amount of time this past week refreshing Twitter to watch the "funding secured" jokes multiply. Somebody made a whole account just posting increasingly absurd things "secured" at exactly $420 a unit. It's very dumb and I loved every bit of it. This is also, I think, a decent argument for why Twitter really needs some kind of edit window, even a short one, because half the reason this became a meme instead of a quietly deleted mistake is that the tweet just sat there, unfixable, for everyone to screenshot.
Tesla's board also has to add two new independent directors and set up a proper committee structure, which honestly should've existed already for a company this size trading on a major exchange. That part gets less attention than the tweet clause but it's probably the more consequential change long-term. A board that's been letting one guy run communications, product, and strategy with basically no internal friction is a board that's been asleep. Two new outside directors won't fix that overnight, but it's something.
What strikes me most, writing this up on a Sunday with coffee that's gone cold, is how fast the whole arc moved. Lawsuit Thursday, settlement Saturday. That's not how securities litigation normally goes, not even close. I don't know if that's the SEC being pragmatic about not wanting to tank a company with thousands of employees over one guy's Twitter habit, or Musk's lawyers moving fast because the alternative (an actual trial, actual discovery, actual depositions) was a much worse outcome for him. Probably both. Either way, Monday morning the market gets to decide what it thinks of a Tesla where Elon Musk is still very much in charge, just with a slightly different title and, in theory, someone reading over his shoulder before he posts.
We'll see how long that lasts.