SEC Chair Atkins Pledges Harmony with CFTC, Says "Era of Duplicative Enforcement Actions" is Over

Musk’s Go-To Attorney Has Testimony Limited in Twitter Trial

Elon Musk’s top attorney, Alex Spiro, took the stand as a witness Tuesday for a few minutes, after Judge Charles R. Breyer significantly limited what Spiro could say to the jury in a trial over Musk’s turbulent 2022 Twitter acquisition. […]

“There is no question he is the most important witness in this case,” Breyer told attorneys for Musk and the investors while the jury was outside the courtroom. But Musk has asserted attorney-client privilege so Spiro’s “most important testimony” can’t be produced, Breyer said.

Attorneys for investors suing Musk fought for months to disqualify Spiro as Musk’s attorney because they argued he was a key witness at the heart of the case who had first-hand knowledge of Musk’s acquisition. Breyer, a trial judge for the US District Court for the Northern District of California, ultimately rejected their arguments and allowed Spiro to serve as both as Musk’s attorney and a witness.

But the judge throughout the trial has expressed concerns about witnesses veering too far into testimony implicating attorney-client privilege, which he has ruled is off limits in the case.

Fostering Regulatory Harmony Between the SEC and CFTC

The SEC, born from the ashes of the 1929 market crash, has overseen securities markets with a mission to protect investors; maintain fair, orderly, and efficient markets; and facilitate capital formation. The CFTC, while formally created in 1974, has deep roots regulating commodity futures and commodity derivatives markets with its own statutory framework and regulatory philosophy.

This division perhaps made some sense at a time when these two markets were distinct ecosystems. But over time, innovation has a way of blurring those boundaries.

When regulatory regimes fail to keep up—and diverge without clear justification—efficiency does not improve, and market integrity does not strengthen. Instead, unnecessary divergence simply imposes cost. Regulatory friction is a tax on efficient risk allocation, and in globally competitive markets, that burden is ultimately borne by American investors, savers, and businesses.

With these principles in mind, and under President Trump’s leadership, I am pleased to report that we are reorienting our approach toward a new golden age of regulatory coherence….

“Is this securities fraud?”

Because it is my schtick, people often send me fact patterns and ask “is this securities fraud?” Curiously, although my schtick is literally “everything is securities fraud,” my answer to these questions is often “no.” Most things that don’t seem like securities fraud are securities fraud, but some things that do seem like securities fraud aren’t. But this is never legal advice.

Also people sometimes give ChatGPT fact patterns and ask “is this securities fraud?” Probably don’t do that? Here’s a TechCrunch article from last week:

The $7 million in annual recurring revenue that Cluely co-founder and CEO Roy Lee shared with TechCrunch last summer was a lie, Lee admitted on Thursday on X. Wrote Lee, this “is the only blatantly dishonest thing i’ve said publicly online, so this is my formal retraction.”

Several people sent me Lee’s posts on X, which are (as someone posted) “the most @matt_levine coded thing to have ever happened”: Lee apparently asked ChatGPT “got a call from some tech crunch reporter asking about revenue. told them 7m arr in reality 6.3m run rate. is this securities fraud,” ChatGPT replied “almost certainly not,” and Lee posted the exchange with the comment “ngl i was sweating for 2 mins.” A verified X account with Elizabeth Holmes’s name on it (!?!?!?!!??) replied “I wouldn’t trust AI with this one.”

There are various not-best-practices things here, but I think I agree with ChatGPT? (Really not legal advice!)….

US solar firm’s lawyer sentenced to 11-year prison term for Ponzi scheme role

A federal judge in Sacramento, California sentenced lawyer Ari Lauer on Monday to more than 11 years in prison for his role in an estimated $912 million Ponzi scheme involving California solar power supply company DC Solar.

Lauer, 61, pleaded guilty in October to 23 criminal counts, including bank fraud and wire fraud affecting a financial institution, one week before his scheduled trial.
As outside counsel to DC Solar, Lauer played a key role in “the largest criminal fraud in the history of the Eastern District of California,” U.S. Attorney Eric Grant said in a statement Monday.

“As the only attorney involved, he should have been the first person to recognize the fraud and stop it,” Grant said. “Instead, he was the last person to accept responsibility, only doing so on the eve of trial.”