Tesla asked Cooley to fire lawyer who worked on SEC Elon Musk investigation

Tesla Motors CEO Elon Musk unveils a new all-wheel-drive version of the Model S car in Hawthorne, California on October 9, 2014.

Lucy Nicholson | Reuters

A Tesla lawyer has asked a law firm to fire one of his lawyers or risk losing his job for the electric carmaker led by Elon Musk, The Wall Street Journal reported On Saturday.

The lawyer Tesla wanted Cooley LLP to fire previously worked at the United States Securities and Exchange Commission. The attorney questioned Musk as part of the agency’s investigation into the Tesla CEO’s claim in 2018 that he secured funding to take Tesla private, the publication said. The investigation led to a settlement under which Musk and Tesla agreed to pay a fine of $20 million each and Musk agreed to step down for three years as Tesla chairman.

Tesla’s attorney late last year asked Cooley to fire the attorney who worked on the SEC investigation, the Journal reported, citing people familiar with the matter. The company did not remove the partner.

Tesla has decided to replace Cooley or hire additional attorneys on several cases since December, according to the Journal.

Musk’s rocket company, SpaceX, has also stopped working with the law firm on regulatory issues, the Journal reported, citing people familiar with the matter.

Tesla has its own ties to the SEC. The company has hired David Misler, a former general counsel for the agency, as chief legal officer.

Musk has faced more regulators than the SEC. The National Highway Traffic Safety Administration has investigated whether Tesla’s Autopilot driver assistance system is at least partly responsible for crashes in which Tesla cars hit parked first aid vehicles.

The agency has hired Missy Cummings — a Duke University professor, automated systems expert, former Navy fighter pilot and Tesla critic — as an adviser in the investigation. In October, Musk tweeted that “his background is extremely biased against Tesla,” causing an uproar among his supporters.

NHTSA then asked Cummings to recuse himself from Tesla-specific questions, the Journal reported on Saturday.

Tesla, SpaceX and Cooley did not immediately respond to CNBC’s requests for comment.

Read the full Journal report here.

CNBC’s Lora Kolodny contributed to this report

CORRECTION: This story has been updated to show that Musk and Tesla have each agreed to pay a $20 million fine and Musk has agreed to temporarily step down as President of Tesla.”

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