U.S. senator Warren questions Musk purchase of Twitter

By David Shepardson

WASHINGTON (Reuters) – Democratic Senator Elizabeth Warren on Monday raised concerns that Tesla Inc's board of directors has failed to meet its legal responsibility to protect the electric vehicle maker in the aftermath of company Chief Executive Elon Musk's acquisition of Twitter, and questioned the reported use of Tesla employees at the social media company.

"Despite widespread concerns about Mr. Musk’s acquisition of Twitter while serving as CEO of Tesla, it remains unclear whether the Tesla board – which has key decision-making authority within the company – is adequately governing the company or if it has established clear rules and policies to address the risks to Tesla posed by Mr. Musk’s dual roles,” Warren wrote to Tesla board Chair Robyn Denholm.

Denholm could not immediately be reached and Tesla did not respond to a request for comment.

Warren cited reports that Musk brought in more than 50 Tesla employees to work at Twitter, "raising questions about misappropriation of Tesla resources and a potential violation of SEC rules, potentially violating SEC ‘antitunneling’ rules that aim to prevent corporate insiders from extracting resources from their firms." SEC is the acronym for the Securities and Exchange Commission.

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

"Twitter relies on advertising revenue from automobile companies that are in direct competition with Tesla, including Audi, Chevrolet, Ford, GM, Jeep, and Volkswagen,” wrote Warren. “As the owner of Twitter, Mr. Musk may decide to run the company to maximize badly-needed revenue, even if that includes great deals for Tesla’s competitors and potential injury to Tesla."

She asked for "detailed information on how the Tesla Board is monitoring these conflicts of interest and Mr. Musk’s appropriation of Tesla assets to Twitter, what guidelines the Tesla Board has put in place to protect Tesla" by Jan. 3.

Separately, Twitter users voted in a poll for Elon Musk to step down as 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 on Sunday evening. More than 17.5 million people voted.

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

(Reporting by David Shepardson; editing by Jonathan Oatis)

Source: Read Full Article