On March 4, 2026, something happened before the Honorable Sparkle Sooknanan in SEC v. Musk that apparently even Margaret Ryan could not stomach. Musk’s attorney Sarah Concannon disclosed the following into the public record, almost in passing:
“ . . . I was informed this morning that we had made progress and was going to be before you asking you to adjourn your decision on the motion for summary judgment pending further discussions. Unfortunately, my colleagues at the SEC were not fully read in on that.”
“That” being active settlement negotiations to resolve a high-profile federal enforcement action.
Judge Sooknanan — who has demonstrated throughout this proceeding that she still operates as though rules and procedures mean something — did not let it pass. She asked again, carefully, the way you ask when you are certain you heard correctly but need the other person to say it out loud one more time:
“Your colleagues at the SEC were not read in to discussions to resolve the case?”
And then again:
“Those discussions didn’t involve counsel in this case?”
Musk’s counsel immediately asked for a sidebar — her exact words:
“Your Honor, if we could have a sidebar. I understand there’s press in the gallery, if we’re going to discuss about the specifics of that.” There was press in the gallery — no need to humiliate the SEC in public if possible. No need to let the world know just how upside down things have become in the SEC enforcement division, where its own career staff are cut out of all negotiations.
Read that sequence again. The SEC’s own litigation team — standing at the plaintiff’s table, the lawyers who built the case, who are officers of the court — had been cut out of settlement negotiations in their own matter. And when a federal judge surfaced it in open court, the instinct was to lower the volume.
Ryan resigned less than two days later. Effective immediately.
