Tesla dumped four members of its 11-member board of directors as part of a move to “streamline” the group to be more efficient. CEO Elon Musk will remain on the board, however.
Tesla Wants to ‘Streamline’ Its Board
Tesla made the surprise announcement in an April 18 SEC filing, where it revealed: “[We are] focusing on a phased streamlining of the size of the Board to allow it to operate more nimbly and efficiently.”
As a result, Brad Buss, Antonio Gracias, Stephen Jurvetson, and Linda Johnson Rice agreed that they will not stand for re-election once their current terms end.
The board realignment comes around the same time that Elon Musk has been feuding with the Securities and Exchange Commission over his Twitter usage.
In March 2019, shareholders sued all 11 members of Tesla’s board over his Twitter use.
Get ready for more of these lawsuits.
Elon Musk and all 11 members of Tesla’s board of directors have been named in a shareholder lawsuit claiming the #Tesla CEO’s “unchecked misstatements on Twitter” have harmed the company. $TSLA https://t.co/waeZOmJTKV
— Alex Chalekian (@AlexChalekian) April 20, 2019
Elon Musk’s Dispute with SEC Still Unresolved
As HVY reported, Musk faced off against the SEC in a New York federal court in early-April.
The SEC had filed a contempt motion claiming Musk violated a September 2018 consent decree under which he agreed to get approval from Tesla before tweeting anything that might impact TSLA’s stock price. In this instance, Musk’s tweet did not move Tesla’s stock.
Musk accused the SEC of overreaching and trying to unseat him as Tesla CEO because he had stated in a recent interview that he has no respect for the agency.
On April 4, federal Judge Judge Alison Nathan ordered the SEC and Elon Musk to settle their differences out of court within two weeks.
Musk and SEC Have Until April 25 to Settle Feud
Those two weeks have since passed. On April 18, Musk and the SEC were granted a one-week delay to resolve their contempt-of-court dispute.
In a joint court filing, the parties said they have set a new deadline of April 25 to resolve their differences:
“While we have not reached an agreement, counsel for the SEC, Mr. Musk, and counsel for Tesla met and conferred for over an hour by telephone earlier this week and are continuing to discuss potential resolution. Because our discussions are ongoing, we respectfully request to provide the Court with another joint submission on or before April 25, 2019, indicating whether we have reached an agreement in principle.”
Billionaire’s Savage Tesla Takedown Ends with Surprise Muppets Quote https://t.co/jIDxgt0D2r
— CCN Markets (@CCNMarkets) April 14, 2019