US Senator Warren questions the Tesla board’s oversight of Musk’s purchase of Twitter

By David Shepardson

WASHINGTON (Reuters) – Senator Elizabeth Warren on Monday expressed concern that Tesla Inc’s board of directors was failing to meet its legal responsibility to protect the company and shareholders in the wake of Chief Executive Elon Musk’s takeover of Twitter, posting questions the reported use of Tesla employees at the social media company.

“Despite widespread concerns about Mr. Musk’s takeover of Twitter while he was CEO of Tesla, it remains unclear whether Tesla’s board – which has the main decision-making authority within the company – is adequately governing the company or whether it has established clear rules. and policies to address the risks to Tesla created by Mr. Musk’s dual role,” Warren wrote to Tesla CEO Robyn Denholm.

Denholm was not immediately available and Tesla did not respond to a request for comment.

Warren, a progressive Democrat and a critic of the technology platforms, has clashed with Musk, previously saying, “billionaires like Elon Musk follow different rules than everyone else and accumulate power for their own gain. We have a wealth tax and strong rules to hold Big Tech accountable.”

She also expressed concern about possible violations of Securities and Exchange Commission rules.

Citing reports that Musk brought in more than 50 Tesla employees to work at Twitter after his $44 billion acquisition, Warren said it “raised questions about misappropriation of Tesla funds and a possible SEC rule violation, possibly in violates SEC ‘anti-tunneling’ rules aimed at preventing corporate insiders from taking resources from their companies.”

Warren said Musk had not explained how he handles conflicts between his role as CEO of Twitter and his position at Tesla.

“Twitter relies on ad revenue from auto companies that compete directly with Tesla, including Audi, Chevrolet, Ford, GM, Jeep, and Volkswagen,” Warren wrote. “As the owner of Twitter, Mr. Musk may decide to sell the company to maximize much-needed revenue, even if that includes great deals for Tesla’s competitors and potential harm to Tesla.”

Most car companies have stopped advertising on Twitter.

She asked for “detailed information on how the Tesla board is overseeing these conflicts of interest and Mr. Musk’s appropriation of Tesla assets to Twitter, what guidelines the Tesla board has established to protect Tesla” by January 3.

Warren’s letter, previously reported by the New York Times, comes after some investors raised questions about Musk’s involvement with Twitter.

Shares of Tesla are down more than 20% since early December, but rose 1.2% during Monday afternoon trading.

Leo KoGuan, a large individual Tesla shareholder, previously wrote on Twitter that Musk has “left Tesla and Tesla has no working CEO. Tesla needs and deserves a full-time working CEO.”

Separately, Twitter users voted in a poll for Elon Musk to step down as Twitter CEO. About 57.5% of the 17.5 million votes were for “Yes,” while 42.5% were against the idea of ​​Musk stepping down as head of Twitter, according to the poll the billionaire launched Sunday night. More than 17.5 million people voted.

Musk said on Sunday he would abide by the poll’s results, but did not specify when he would step down if the results said he should.

(Reporting by David Shepardson; editing by Jonathan Oatis and Aurora Ellis)

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