Is it illegal for a big shareholder (significant owner) to open a short position before selling shares, knowing that the price will drop?

Was just thinking about this in light of Elon's sale of TSLA this week. It tanked the stock due to the large sale order. If he had opened a short position in TSLA before hand (with or without disclosing) would that be legal for him to do?

What if he wasn't the CEO but just an owner? Does the CEO a fiduciary for shareholders? Having a short position in the company you are a CEO for obviously isnt a great look, but is it illegal?

Anyway, just food for thought.