Securities Law

Musk Cleared on Alleged Short-Swing Profits from SolarCity Deal (1)

Aug. 1, 2019, 1:26 PM; Updated: Aug. 1, 2019, 2:31 PM

Tesla Inc. CEO Elon Musk was cleared by a federal court of liability for alleged short-swing profits from buying SolarCity, a solar energy firm founded by his cousins.

Musk can’t be sued under federal securities law for short-swing profits he allegedly made by selling shares he acquired through a stock-for-stock exchange with SolarCity , the U.S. District Court for the Northern District of California said.

Musk’s sales of the stock within six months of acquiring it were exempt from liability under Section 16(b) of the Securities Exchange Act of 1934 because he got it from its issuer, Tesla, through a...

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