Securities and Exchange Commission v. Musk

CourtDistrict Court, District of Columbia
DecidedOctober 2, 2025
DocketCivil Action No. 2025-0105
StatusPublished

This text of Securities and Exchange Commission v. Musk (Securities and Exchange Commission v. Musk) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Securities and Exchange Commission v. Musk, (D.D.C. 2025).

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

SECURITIES AND EXCHANGE COMMISSION,

Plaintiff, Civil Action No. 25 - 105 (SLS) v. Judge Sparkle L. Sooknanan

ELON MUSK,

Defendant.

MEMORANDUM OPINION

In the spring of 2022, Elon Musk purchased shares of Twitter, Inc.’s common stock.

According to the Securities and Exchange Commission (SEC), the purchase of those shares

triggered an obligation to file a report with the SEC disclosing Mr. Musk’s Twitter holdings. The

SEC sued Mr. Musk, alleging that he violated the Securities Exchange Act of 1934 and Rule 13d-1

promulgated under that Act by filing the required report late. Mr. Musk has moved to transfer this

case to the Western District of Texas, or in the alternative, the Southern District of New York. The

Court denies that motion.

BACKGROUND

The Court draws the facts, accepted as true, from the Plaintiff’s Complaint and

attachments. Wright v. Eugene & Agnes E. Meyer Found., 68 F.4th 612, 619 (D.C. Cir. 2023). The

Court also takes “judicial notice of public records from other court proceedings.” Lewis v. Drug

Enforcement Admin., 777 F. Supp. 2d 151, 159 (D.D.C. 2011).

In January 2022, Mr. Musk directed his personal wealth manager to start purchasing large

amounts of Twitter common stock, but not to exceed five percent of Twitter’s outstanding common stock. Compl. ¶ 14, ECF No. 1. The wealth manager instructed a broker dealer to buy the stock,

and the broker began doing so on January 31, 2022, and continued to purchase stock throughout

February 2022. Compl. ¶ 18. In early March of that year, at Mr. Musk’s direction, the wealth

manager instructed the broker dealer to buy Twitter stock that would push Mr. Musk past the five

percent threshold. Compl. ¶ 22. At the close of trading on March 14, 2022, Mr. Musk “beneficially

owned” more than five percent of the outstanding shares of Twitter stock. Compl. ¶ 23.

According to the SEC, passing the five percent threshold triggered a requirement for

Mr. Musk to publicly disclose his Twitter holdings by filing a “beneficial ownership report” on a

Schedule 13D or, if eligible, Schedule 13G by March 24, 2022. Compl. ¶ 25. But Mr. Musk did

not file a Schedule 13G until April 4, 2022. Compl. ¶ 40. Mr. Musk then filed a Schedule 13D on

April 5, 2025. Compl. ¶ 43.

Between the March 24 deadline and April 4, Mr. Musk continued to buy large amounts of

Twitter common stock, reaching ownership of nearly eight percent of outstanding shares by March

25, 2025, and over nine percent by April 1, 2025. Compl. ¶¶ 28, 37. On April 4, 2025, after

Mr. Musk filed the Schedule 13G, Twitter’s stock price increased more than twenty-seven percent.

Compl. ¶ 42.

On January 14, 2025, the SEC sued Mr. Musk in this Court. The Complaint alleges that

Mr. Musk violated Section 13(d) of the Securities Exchange Act of 1934, 15 U.S.C. § 78m(d), and

Rule 13d-1, 17 C.F.R. § 240.13d-1. Compl. ¶ 48. It seeks remedies including a civil penalty and

disgorgement. Compl. at 9–10.

On August 28, 2025, Mr. Musk filed a Motion to Transfer, asking the Court to transfer this

case to the Western District of Texas, or in the alternative the Southern District of New York.

2 ECF No. 15. That motion is fully briefed and ripe for review. See Resp. Opp’n Def.’s Mot.

Transfer Venue, ECF No. 20; Reply Supp. Def. Elon Musk’s Mot. Transfer Venue, ECF No. 21.

LEGAL STANDARD

“For the convenience of parties and witnesses, in the interest of justice, a district court may

transfer any civil action to any other district or division where it might have been brought or to

any district or division to which all parties have consented.” 28 U.S.C. § 1404(a). Section 1404(a)

is intended “to prevent the waste ‘of time, energy and money’ and ‘to protect litigants, witnesses,

and the public against unnecessary inconvenience and expense.’” Van Dusen v. Barrack, 376 U.S.

612, 616 (1964) (quoting Cont’l Grain Co. v. The FBL–585, 364 U.S. 19, 26–27 (1960)).

“The threshold question under section 1404(a) is whether the action ‘might have been

brought’ in the transferee district.” SEC v. RPM Int’l, Inc., 223 F. Supp. 3d 110, 114 (D.D.C.

2016). “After establishing that the threshold requirement has been met, the Court ‘must balance

case-specific factors which include the private interests of the parties as well as public interests

such as efficiency and fairness.’” Id. at 114–15 (quoting The Wilderness Soc’y v. Babbitt, 104

F. Supp. 2d 10, 12 (D.D.C. 2000)). The private-interest factors include: “(1) the plaintiff’s choice

of forum; (2) the defendant’s choice of forum; (3) whether the claim arose elsewhere; (4) the

convenience of the parties; (5) the convenience of the witnesses; and (6) the ease of access to

sources of proof.” Tower Lab’ys, Ltd. v. Lush Cosms. Ltd., 285 F. Supp. 3d 321, 325 (D.D.C. 2018)

(quoting Douglas v. Chariots for Hire, 918 F. Supp. 2d 24, 31 (D.D.C. 2013)). The public-interest

factors include: “(1) the transferee’s familiarity with the governing laws; (2) the relative

congestion of the calendar of the transferor and transferee courts; and (3) the local interest in

having local controversies decided at home.” Id. (quoting Douglas, 918 F. Supp. 2d at 31). “The

burden is on the moving party to establish that transfer is proper.” Id. (quoting Trout Unlimited v.

U.S. Dep’t of Agric., 944 F. Supp. 13, 16 (D.D.C. 1996)).

3 DISCUSSION

Mr. Musk moves to transfer this case to either the Western District of Texas or the Southern

District of New York. After considering all the relevant factors, the Court concludes that neither

transfer is warranted.

A. Western District of Texas

Mr. Musk first contends that this Court should transfer this case to the Western District of

Texas. The SEC concedes that the Western District meets the threshold requirement that the action

“might have been brought” there. See Opp’n at 8 n.1; RPM Int’l, 223 F. Supp. 3d at 114. The Court

agrees. “An action may be brought in any judicial district in which ‘any defendant resides, if all

defendants are residents of the State in which the district is located’ or in a district where ‘a

substantial part of the events or omissions giving rise to the claim occurred.’” RPM Int’l, 223

F. Supp. 3d at 114 (quoting 28 U.S.C. § 1391(b)(1)–(2)). The Securities Exchange Act of 1934

also provides that “venue is proper where ‘the defendant is found or is an inhabitant or transacts

business.’” Id. (quoting 15 U.S.C. §§ 77v(a), 78aa). Mr. Musk has proffered sufficient facts to

establish that, at a minimum, he transacts business in the Western District of Texas. Decl. Jared

Birchall ¶ 1, ECF No. 15-2. Accordingly, the Court proceeds to consider the private- and public-

interest factors.

1.

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