The Securities and Exchange Commission (SEC) on Thursday sued Tesla (TSLA.O) Chief Executive Mark for fraud and sought to oust him from the company's top management, saying he published several serious "false and misleading" tweets last month about the possible privatization of Tesla.
The 47 year old musk is one of the most high-profile figures in the technology industry executives prosecuted by SEC. Losing the company's signature and leadership will hit Tesla hard, which is still losing money, mainly because investors trust Musk's leadership. Tesla's market capitalization is more than 50 billion dollars.
Tesla shares tumbled 12% in after hours trading.
Mask said he didn't do anything wrong. "I am deeply saddened and disappointed by this SEC's erroneous action," he said in a statement.
The SEC said in the lawsuit that Musk calculated the price of $420 a share at a level of 20% above the closing price of the day, also because the figure implied marijuana. It is said that musk said his girlfriend would find this very interesting.
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