Jay A. Dubow Quoted in Wired Article, 'The SEC Is Suing Elon Musk (It's the Tweets)'
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 the September 27, 2018 Wired article, " The SEC Is Suing Elon Musk (It's the Tweets)."
The SEC is also seeking an injunction to more formally bar Musk from making false statements in the future. If he were to not comply with this injunction, he could face contempt of court charges, says Jay Dubow, a partner specializing in white-collar litigation at the law firm Pepper Hamilton.
Another problem with an injunction against Musk, Dubow says, is that it might make it harder for any venture associated with the Tesla CEO, including SpaceX, Neuralink, or the Boring Company, to raise money. "If you're trying to raise money through a private offering, there are exemptions from registrations from securities laws," Dubow says. "If you have an injunction like this, you can't take advantage of such exemptions."
Finally, and perhaps most painfully for Musk, the SEC seeks to bar Musk from acting as an officer or director for any public company—including Tesla. This is not unusual: "The SEC has been seeking that kind of relief in cases for a long time," Dubow says.
And while it's too early to say what will happen here, Dubow notes that "most SEC cases are settled." That is, the sides could negotiate a deal: The defendant could agree to pay a fine or bear a penalty in exchange for some acknowledgement of wrongdoing.
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