U.S. securities regulators sued Elon Musk in federal court in Washington on Tuesday in an enforcement action arising from his $44 billion purchase of Twitter, now called X.
The lawsuit against Mr. Musk, who has become a close adviser to President-elect Donald J. Trump, is likely to be one of the more contentious final acts of the Securities and Exchange Commission under the direction of Gary Gensler, its departing chair.
The S.E.C. contends that in buying Twitter in 2022, Mr. Musk violated securities laws by amassing a large stock position in the company without filing the proper notification. The complaint said he had waited 11 days before filing the required disclosure with the S.E.C.
The regulatory filings are required so investors in the marketplace can monitor the moves of large investors and potential takeover bids.
Over the past few weeks, Mr. Musk had taunted the S.E.C. in posts on X about the potential for filing a lawsuit. In December, he shared a letter that his lawyer had sent to the agency, rejecting a settlement offer in the case.
This is the third time the S.E.C. has gone to court with Mr. Musk, with the first case being brought by securities regulators during Mr. Trump’s first term in office. That lawsuit arose from inappropriate market-moving posts that Mr. Musk had made about his musing about taking his electric car company, Tesla, private.
Before filing the lawsuit on Tuesday, the S.E.C. had gone to court to force Mr. Musk to comply with a subpoena seeking to take his deposition.
With Mr. Gensler stepping down with the inauguration of Mr. Trump on Monday, it is unclear whether regulators will continue the litigation. Mr. Trump has said he intends to nominate Paul Atkins, a former S.E.C. commissioner and pro-business conservative, to succeed Mr. Gensler.
This is a developing story. Check back for updates.
