On Monday, Elon Musk, CEO of the electric car maker Tesla took a shot at the U.S. securities regulators by saying in a filing that one of his recent tweets which talked about Tesla's production volume did not violate his fraud settlement with the SEC in any manner and therefore he should not be held in contempt of court. According to a recent filing by Musk's lawyers, his tweet which clearly stated that Tesla is going to produce more than 500,000 cars in 2019 does not violate the company's policy of communication for the senior executives, which was implemented as a part of the recent settlement.

Elon Musk's Twitter controversy

The U.S. Securities Exchange Commission is arguing to the court for holding Musk in contempt because according to them, he is in gross violation of a fraud settlement that took place in September banning him from sharing any sort of information on social networking sites regarding Tesla without a pre-approval from the company. In December, during quite an intense "60 Minutes" interview with the Tesla chief, he clearly said that he doesn't hold any kind of respect for the SEC.

The settlement that occurred between the SEC and Elon Musk sometime ago was mainly because of Musk's tweet in which he stated that he has secured the entire financing needed to take his electric car company private.

In the tweet, Musk mentioned the price at $420 per share. However, soon after that, the SEC said that those tweets by Musk were purely false and deceptive and that a deal for taking Tesla private was never in place.

Tesla's profitability problems

As a part of the deal for that settlement, Musk was forced to step down as Tesla's chairman and was also ordered to pay a whopping $20 million fine to the SEC.

The newly emerged battle between the Tesla CEO and the SEC has added an intense pressure on the billionaire tycoon on top of the existing pressure of making Tesla profitable, which he hasn't been able to achieve even after slashing down the price of its Model 3 car to nearly $35,000.

In its attempts to attain profitability, the company has even closed down all of its offline stores and has decided to raise the prices of its luxury high-end models by barely 3 percent.

Interestingly, since the settlement took place between the SEC and Elon Musk, he has reduced sharing information on social networks quite significantly, especially on the Twitter platform. However, he has also said that if possible, he would like to raise free speech issues with the SEC, as per the details supplied in the filing by Musk's lawyers.

Just after the settlement with the SEC was in place, Musk took to Twitter and mocked the agency calling them funny names such as "Shortseller Enrichment Commission". He even tweeted that there is something seriously broken within the SEC, around one day after they began to look into the contempt order.

The legal experts are now saying that the SEC has multiple options before them, including charging Musk a humongous fine, putting some severe restrictions on his actions or even forcing him to step down from Tesla's board of directors.

Tesla has even set up a committee for overseeing compliance of the company's new communications policy. This newly established committee is comprised of members from its board of directors such as Brad Buss, Antonio Gracias, and James Murdoch.