Elon Musk has little to fear from Philadelphia’s lawsuit against his offer to award $1 million a day to registered voters signing a petition in support of free speech and the right to bear arms.
On Monday, city district attorney Lawrence Krasner filed a civil complaint against the world’s wealthiest man, arguing that his scheme to help Donald Trump’s election bid is an unsanctioned lottery that violates the state laws.
While politically this might give a boost to Krasner's reelection chances next year, a Pennsylvania-based professor of election law told Fortune that legally, the argument holds no water. To begin with, no one has bought a ticket, after all.
“There are reasons to outlaw unregulated gambling, but that’s because you’re ripping people off,” said Michael Dimino, who teaches at Widener University’s Commonwealth Law School in the state capital of Harrisburg. “If you’re just deciding on the basis of random chance to give away money, that’s not a lottery.”
Philadelphia’s lawsuit made headlines across the country, since Pennsylvania, with its 19 electoral votes, is considered to be one of the biggest swing states in the race for president—a race that Musk intends to win on behalf of Trump.
The district attorney's office could not be reached by Fortune for comment.
'Who is he protecting and from what?'
Krasner is reportedly believed to be eyeing a third term as the city’s DA. Krasner initially won election to the DA's office after he received $1.7 million in campaign funding from George Soros.
He may, however, be facing an uphill battle against likely opponent Derek Green given the perception that Krasner is soft on crime. Governor Josh Shapiro has even installed a special prosecutor that infringes on his jurisdictional authority, a move Krasner has unsuccessfully attempted to block.
The law the Philadelphia DA cited on Monday as justification to sue Musk was designed to prevent obvious fraud. This includes staging a lottery only to embezzle the funds and disappear overnight—or to rig it so that a predetermined recipient is awarded the cash paid by other participants.
Musk’s sweepstakes does not fall under such a category, since it uses the entrepreneur’s own money.
“He’s saying this is violating Pennsylvania consumer protection statutes,” Dimino told Fortune. “But who is he protecting and from what?”
What Musk is effectively doing is no different from thumbing through the phone book blindfolded, landing on a name by chance, and mailing that person a check. “I sure hope that Krasner never picked a homeless guy at random and decided to give him a dollar, since that is what he’s saying is illegal here,” Dimino said.
Musk could fall afoul of federal laws
That doesn’t mean Musk is entirely in the clear. Musk is only awarding money to those who sign what his America political action committee has called a petition in favor of the First and Second Amendments under the stipulation they are registered to vote in a swing state. Nor has the PAC released any of the names or signatures of those that signed it, a common practice for petitions.
This could be a problem because there is a federal statute prohibiting the act of paying people to vote, not to vote, or even just to register to vote. While the Justice Department has reportedly warned Musk that what he is doing may be illegal, it has not taken any official action.
The petition itself is moreover dubious since it involves only the most anodyne statement of support—it doesn't explain why it’s important to support rights guaranteed under the Constitution and upheld repeatedly by the courts (though Musk’s candidate, Donald Trump, has called for jail time for those burning the U.S. flag in protest, a form of protected free speech).
The obvious suspicion is that the document is an excuse to harvest and store the personal data of swing-state voters in an America PAC database as a means of micro-targeting Trump voters to get out the vote.
Even a fine would not be a problem for Musk
Yet Dimino tells Fortune that while there are legitimate concerns Musk could be violating criminal law due to the explicit requirement that signatories seeking to receive cash be registered to vote, the risks to the Tesla CEO are limited in scope. That's because the lion's share of those signing the document likely were already registered to begin with, so the question is then how many may have been motivated to register solely to qualify for the cash reward.
Moreover the worst punishment Musk might face is the equivalent of a slap on the wrist. Federal prosecutors would almost certainly stop short of seeking any prison time, in Dimino’s view. Even then it would doubtlessly be appealed by Musk’s legal team.
That isn’t to say the $10,000 fine that could be levied isn’t steep. “If you’re a vindictive Kamala Harris justice department, you’re going to try to charge one count for every voter,” Dimino tells Fortune, “and there might be thousands.”
Musk has an estimated net worth of $270 billion—so a fine may not be a deterrent.
Should Trump win, the law professor expects a Trump-appointed Justice Department would exercise its legal discretion to drop any and all investigative measures upon taking office. “I don’t think he’s in any serious amount of trouble,” Dimino concludes, “and if Trump wins, he’s obviously not in any trouble at all.”
