"Whether Musk can defeat the SEC lawsuit without Trump's intervention remains to be seen as the lawsuit advances. In her opinion, the judge found that the government's interest in requiring disclosures to ensure fair markets outweighed Musk's fears that disclosures compelled speech revealing his "thoughts" and "strategy." Accepting Musk's arguments would be an "odd" choice to break "new ground," she suggested, as it could foreseeably impact a wide range of laws."
"Musk may be able to develop his arguments on selective enforcement as a possible path to victory. But Sooknanan noted that "despite having very able counsel," his case right now seems weak. In her opinion, Sooknanan also denied as premature Musk's motions to strike from potential remedies the SEC requests for disgorgement and injunctive relief. Likely troubling Musk, instead of balking at the potential fines, the judge suggested that "the SEC's request to disgorge $150 million" appeared reasonable."
First Amendment and vagueness claims were rejected because disclosures serve the government's interest in ensuring fair markets. The disclosure statute was viewed as a lawful balance that does not force Musk to reveal protected private thoughts or strategy. Courts have long upheld laws requiring regulated parties to state purposes, plans, or intentions, and disclosures alert investors to potential changes in control. Selective enforcement arguments remain a possible but undeveloped path for Musk. Motions to strike disgorgement and injunctive relief were denied as premature. The SEC's request to disgorge $150 million was described as reasonable and corresponding to complaint allegations.
Read at Ars Technica
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