Jay A. Dubow, a partner with Pepper Hamilton, a member of the firm’s White Collar Litigation and Investigations Practice Group and a co-chair of the Securities and Financial Services Enforcement Group, was quoted in several articles after the Securities and Exchange Commission (SEC) announced they had reached a settlement with Tesla CEO Elon Musk. The SEC alleged in a lawsuit that Musk made "false and misleading statements" in August 2018 about the possibility of taking Tesla private. Under the terms of the settlement, Musk doesn't admit or deny the allegations in the agency's lawsuit against him, but he will step down as the chairman of Tesla's board of directors for three years and pay a $20 million fine.
Mr. Dubow says, "It's unusual that Musk will step down as chairman but remain CEO, since executives usually have to resign from both positions when they settle with the SEC in similar situations.
The SEC may have determined that removing Musk as CEO would have been bad for shareholders.
The settlement is good for Musk and Tesla since it eliminates the uncertainty the company would have faced if it had to find a new CEO.
The settlement is good for the SEC since it received a lot of attention and sent a message to other executives."
Mr. Dubow was quoted in the following articles: