Written by Tom Hals
Wilmengton, Delaware (Reuters) – Elon Musk began his appeal to try to restore the day of $ 56 billion from Tesla on Tuesday, claiming that the minimum court judge made multiple legal errors in canceling the record compensation.
Musk argued that the 2018 payment package resulted in amazing growth of the electric car maker, however it was determined by the lower court of Chancery to be unfair to the shareholders, who voted twice to agree to the plan.
“This anti -intuitive result defies the principles of Dilayer laws, the governance of sound companies, and a healthy sense,” said the opening appeal summary of Musk and the current Tesla directors who are the defendants in the case.
In January 2024, Chancellor Cataline McCorkalized the paid for stock options, describing it as “incomprehensible”. She said that it was not fair, Tesla’s shareholders, because the managers who agreed to this were owned by Moussa and Tesla, the main information from investors before they voted for approval.
In June, Tesla obtained the shareholders ’approval of the payment package for the second time, but the judge refused this as reasons to reverse her ruling.
The Musk Payment Options Grant to buy about 303 million Tesla shares at about $ 23 each if the company achieves performance and evaluation goals. Tesla closed on Tuesday at $ 230.58.
Tesla said that creating a new salary package with a similar value can lead to a fee of $ 25 billion, which makes the appeal an important way to restore the musk compensation and maintain its attention on Tesla.
Musk said he wants a greater stake in Tesla or may develop products outside the company. This appeal comes because it devotes time to the effort of government competence of President Donald Trump, known as Dog, who sparked demonstrations outside Tesla agents. The arrow has decreased sharply in recent weeks.
In the appeal summary, Musk and other defendants said that McCormick had applied a very difficult legal mistake known as the entire fairness to assess the wage package.
It reached this standard by finding Musk, which owned 21.9 % of shares at a time when the council agreed to the payment package, to control the wage negotiations, according to the summary. In addition, I decided that normal trade relations between managers made them conflicting and wrongly erred in Tesla’s disclosure before the shareholders ’vote for 2018, according to the summary.
The summary said that the application of the entire standard of fairness is a “license to prosecute” contributors to Tesla. The lawsuit was filed by Richard Torneta, Tesla investor who had nine shares when he filed the case in 2018.
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