The U.S. Securities and Exchange Commission (SEC) sued Elon Musk on Tuesday (January 14), accusing him of waiting too long to disclose his 2022 purchase of a large stake in Twitter. Musk is accused of violating federal securities laws by waiting 11 days to reveal that he had acquired 5% of the company’s shares. The SEC’s complaint, filed in the U.S. District Court for the District of Columbia, accuses Musk of violating Section 13(d) of the Exchange Act and related rules.

The SEC claims Musk’s delayed disclosure allowed him to buy over $500 million worth of Twitter shares at artificially low prices. When Musk finally announced his purchases on April 4, 2022, Twitter’s share price jumped 27%.

The lawsuit seeks to force Musk to pay a civil fine and return profits he allegedly gained unfairly. Musk went on to purchase Twitter for $44 billion in October 2022, later rebranding the company as X. The SEC’s complaint claims that Musk’s failure to file a timely beneficial ownership report resulted in investors selling Twitter stock between March 25, 2022, and April 1, 2022, at artificially low prices. This, according to the SEC, caused those investors significant financial losses.

Musk has responded to the lawsuit on his platform, X (formerly Twitter), calling the SEC a “totally broken organization” and criticizing the agency for focusing on this issue while other more serious crimes go unpunished. Despite this ongoing legal battle, Musk has consistently avoided court appearances, delegating legal matters to his lawyers.

The SEC filed the lawsuit just days before Gary Gensler, the current SEC chair, steps down on January 20. His successor, Paul Atkins, nominated by Trump, is expected to review many of Gensler’s actions.