Tesla is already facing investigations from the National Highway Traffic Safety Administration and National Transportation Safety Board over the death of 40-year-old Joshua Brown in early May. But the SEC investigation is focusing on whether Brown's death is a "material" event – an event or incident that could influence a shareholder's actions.
Right now, Tesla is defiant. A spokesperson pointed the WSJ to a blog post "asserting that the May 7 crash didn't require disclosure to investors." As we reported previously, Elon Musk claimed the deadly crash "is not material to the value of Tesla."
To recap, in Tesla's take-down piece of a Fortune article, the company called the crash a "statistical inevitability" that can't "alter the conclusion already borne out over millions of miles that the system provided a net safety benefit to society."
Musk backed the claim up in an email exchange with Fortune.
"Indeed, if anyone bothered to do the math (obviously, you did not) they would realize that of the over one million auto deaths per year worldwide, approximately half a million people would have been saved if the Tesla Autopilot was universally available. Please, take five mins and do the bloody math before you write an article that misleads the public."
Tesla further challenged the material nature of the incident in its blog post, arguing that "the day the news broke about NHTSA's decision to initiate a preliminary evaluation into the incident, Tesla's stock traded up, not down, confirming that not only did our investors know better, but that our own internal assessment of the performance and risk profile of Autopilot were in line with market expectations."
According to The Wall Street Journal, we're still in the early stages of the SEC's investigation. We'll continue to follow this one as it develops.