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☆ They blocked Elon Musk’s massive payday. Now they want $7 billion for it
▼ + stars: | 2024-07-09 | by ( ) edition.cnn.com time to read: +3 min

The legal fee represents a cut of the value that the plaintiff’s lawyers say was created for Tesla by a Delaware judge’s January ruling that rescinded Musk’s $56-billion pay package. The Musk case took a dramatic turn when Tesla shareholders in June voted to ratify Musk’s pay, which Tesla has argued corrected the flaws in the 2018 process that McCormick identified in her ruling. The company argues that Musk’s pay package has been restored and that Tornetta’s legal victory has been transformed into a loss. McCormick may take weeks or months to rule on the legal fee. The Delaware Supreme Court is considering a $267 million fee request in a shareholder class action involving Dell Technologies and that decision could provide fee guidance.

Persons: Elon Musk’s, Richard Tornetta, Tornetta, John Reed, ”, Chancellor Kathaleen McCormick, Bernstein Litowitz Berger, Grossmann, Greg Varallo, Tesla, Varallo, ” Varallo, Reed, McCormick Organizations: Delaware CNN, Tesla, Musk’s, Enron, Stanford Law School, Delaware Supreme, Dell Technologies Locations: Wilmington, Delaware

☆ Judge will consider $6 billion legal fees for lawyers who voided Elon Musk's multibillion pay package
▼ + stars: | 2024-06-28 | by ( Lloyd Lee | ) www.businessinsider.com time to read: +4 min

Read previewA Delaware judge still wants to consider a $6-billion request in legal fees from lawyers who shot down Elon Musk's multibillion-dollar pay package at Tesla regardless of the recent shareholder vote, court documents show. In January, Chancellor Kathleen McCormick of the Delaware Chancery Court ruled against Elon Musk's pay package that would've awarded the Tesla CEO more than $55 billion in stock at the time. With the outcome, lawyers representing Richard Tornetta, the Tesla shareholder who objected to the compensation plan, argued that they provided a valuable service in getting Musk's package rescinded. But Musk received some good news in June after shareholders voted to re-approve the CEO's pay package and maintain the current board structure with Kimbal and James Murdoch. Chancellor McCormick will have to decide on the fate of the package and whether the plaintiff's attorneys do deserve about $6 billion in legal fees.

Persons: —, Elon Musk's, Kathleen McCormick, McCormick, Richard Tornetta, Musk, James Murdoch, doesn't, Chancellor McCormick, James, Park Organizations: Service, Elon, Business, University of California, Tesla Locations: Delaware, Los Angeles

What's next: Media Matters filed a motion to dismiss Musk's lawsuit in March, but a judge has yet to rule. VCG/GettyGovernment lawsuits and investigationsSEC investigation into Musk's Twitter takeoverThe issues: The Securities and Exchange Commission is investigating Elon Musk's Twitter purchase. Matt Winkelmeyer/Getty ImagesPersonal lawsuits against MuskTornetta v. MuskThe issues: Tesla shareholder Richard Tornetta sued Musk and Tesla in a class action lawsuit regarding Musk's compensation package, which was worth $55.8 billion at the time. Several lawsuits also allege Musk discriminated against them because of their race, gender, or disability in choosing to fire them. The executives were set to receive golden parachutes, but claim Musk and X have not paid them out.

Persons: —, Elon Musk, Musk, Claire Boucher, Grimes, Alex Spiro, Sam Altman, Donald Trump, Spiro, Anna Webber, Angelo Carusone, What's, Gina Carano, Schaerr Jaffe, Tesla, Musk's, Elon, SEC hasn't, Elon Musk's, who've, Owen Diaz, Matt Winkelmeyer, Richard Tornetta, Kimbal Musk, He's, Boucher, Benjamin Brody, Brody, Brody reverberated, Ben Brody, didn't, Robert Kaiden, Kaiden, he's, Agrawal, Parag Agrawal, Ned Segal, Twitter Vijaya Gadde, Sean Edgett, Segal, hadn't Organizations: Service, SpaceX, Business, OpenAI, SEC, Trump, Trump —, Elon, Variety, Media, X Corp, Disney, National Labor Relations Board, UAW, Tesla, Getty Government, Twitter, Securities, Exchange Commission, Justice Department, Reuters, Traffic, Administration, NHTSA, Apple, NLRB, Musk's SpaceX, US, Employment Opportunity, Musk, Nazi, Litigation Locations: Texas, Texas and Missouri, America, Nazi Germany, California, Delaware, San Francisco

☆ Tesla asks shareholders to vote again on Musk's $56 billion payout
▼ + stars: | 2024-04-17 | by ( Rohan Goswami | In Rohangoswamicnbc | ) www.cnbc.com time to read: +2 min

Tesla said Wednesday it will ask shareholders to reinstate CEO Elon Musk's $56 billion pay package, which a Delaware judge voided earlier this year after ruling that the record-setting compensation deal was "deeply flawed." Tesla said the court decision created a "fundamental problem for the company." Tesla has not hired Innisfree since 2018, when it first asked shareholders to vote on Musk's pay package. Musk's pay package was invalidated after a shareholder won a lawsuit against the company earlier this year. The company also noted that "dozens of institutional stockholders" have told Tesla that they disagree with the Tornetta decision.

Persons: Elon Musk, Lola, Tesla, Elon Musk's, Musk, Innisfree, Musk's, Chancellor Kathaleen McCormick, Richard Tornetta, McCormick Organizations: Regency Bruin Theatre, Twitter, Board, Delaware Court Locations: Los Angeles , California, U.S, Delaware, Texas

☆ Lawyers who voided Elon Musk's pay as excessive want $6 bln fee
▼ + stars: | 2024-03-02 | by ( ) www.cnbc.com time to read: +1 min

The lawyers who voided Elon Musk's $56 billion compensation as excessive on Friday sought a record a $6 billion legal fee, payable in the electric car maker's stock. Musk blasted the request as "criminal," posting on his X platform that "the lawyers who did nothing but damage Tesla want $6 billion." The company would pay the lawyers who represented Richard Tornetta, a shareholder who sued Musk in 2018 over the pay package, which a Delaware judge nixed in January. The electric vehicle maker is being asked to pay the fee because it benefited from the return of Musk's pay package, which the legal team said will result in the return to the carmaker of 266 million shares. Judge Kathaleen McCormick, who is overseeing the case and will decide on the fee, called Musk's pay "unfathomable" in her ruling.

Persons: Elon Musk, Tesla, Elon, Musk, Richard Tornetta, nixed, Kathaleen McCormick Organizations: Elon Musk's Locations: Krakow, Poland, Delaware

☆ Lawyers seek nearly $6 billion in Tesla stock after getting Musk pay package struck down
▼ + stars: | 2024-03-02 | by ( David Ingram | Lora Kolodny | ) www.cnbc.com time to read: +4 min

The lawyers had earlier convinced the Delaware chancery court to revoke Musk's $56 billion pay package from 2018, with the judge ruling that Tesla's board of directors failed to prove it was fair to shareholders. The lawyers represent former heavy metal drummer Richard Tornetta, who filed the suit on behalf of his fellow Tesla investors. The lawyers are asking for just over 11% of the Tesla shares that would have gone to Musk, or slightly more than 29.4 million shares. Taking their pay in Tesla shares demonstrates they are prepared to "eat our cooking," the lawyers wrote. Musk's pay package was the largest ever disclosed in corporate America, according to Delaware Chancery Court Judge Kathaleen McCormick's 200-page ruling.

Persons: Elon Musk, BARTOSZ SIEDLIK, Elon, paydays, Richard Tornetta, Greg Varallo, Bernstein Litowitz Berger, Grossmann ., Tesla, Kathaleen McCormick's, Musk Organizations: European Jewish Association, Getty Images, Enron, Musk's, Tesla, Grossmann, Musk Locations: Krakow, AFP, Delaware, New York, America, Texas

☆ Tesla board silent as investors await next steps after Elon Musk's $56 billion pay package revoked
▼ + stars: | 2024-02-13 | by ( Lora Kolodny | In Lorakolodny | ) www.cnbc.com time to read: +7 min

Antonio Masiello | Getty ImagesTwo weeks after a Delaware court ruled that Tesla must rescind Elon Musk's $56 billion pay package, the company's board remains mum on what the decision means for shareholders or what's next for the mercurial CEO. CNBC sent requests for additional information to Tesla investor relations, Musk and some board members. "Given the high stakes involved, it is likely that Tesla will appeal the decision," Kastiel said in an email. In the absence of a successful appeal, "any new compensation arrangement with him will have to be assessed" in light of McCormick's decision, Kastiel said. Kastiel also said that the decision likely makes Musk and Tesla more vulnerable to other types of lawsuits.

Persons: Elon Musk, Antonio Masiello, Tesla, Chancellor Kathaleen McCormick, Musk, Richard Tornetta, Kimbal, Robyn Denholm, JB Straubel, Greg Varallo, Bernstein Litowitz Berger, Grossmann, Varallo, Kobi, Kastiel wasn't, Kastiel, Eric Talley, Talley, wasn't, He's, Walter Isaacson, CNBC's, you'll, Isaacson, Ann Lipton, Lipton, — Organizations: Tesla Inc, Fratelli, Getty, Elon Musk's, SEC, CNBC, Tel Aviv University, Washington University Law, Nasdaq, Columbia Law School, SpaceX, Tesla, Tulane Law Locations: Italy, Rome, Delaware, Texas, Tesla, Nevada, California

☆ The Tesla shareholder who denied Musk his $55 billion payday is a former heavy metal drummer
▼ + stars: | 2024-02-02 | by ( Tom Carter | ) www.businessinsider.com time to read: +2 min

Richard Tornetta sued Tesla in 2018 over Elon Musk's $55 billion compensation plan. The Tesla shareholder is a former heavy metal drummer for the thrash-metal band Dawn of Correction. A Judge sided with Tornetta and struck down the pay package, calling it unfair to shareholders. AdvertisementThe Tesla shareholder who won a dramatic legal victory that denied Elon Musk his $55 billion compensation package used to be a heavy metal drummer. The EV maker will need to develop a new compensation plan for Musk, although it can appeal.

Persons: Richard Tornetta, Tesla, —, Elon Musk, of, Musk, Tornetta, Kimbal Organizations: Elon Musk's, Service, YouTube, Reuters, Business Locations: Delaware, Texas

☆ Why Elon Musk's battle with Delaware is about more than a $55 billion pay package
▼ + stars: | 2024-01-31 | by ( Hasan Chowdhury | ) www.businessinsider.com time to read: +7 min

Musk's Tesla pay was structured without a salary to involve 12 stock option awards that would only be given once performance goals for each of them were met. Though Musk can appeal the decision, there are signs that this battle is about more than just the massive pay package that has propelled him to a $205 billion fortune. The carmaker is currently worth $600 billion, up from roughly $50 billion in 2018, when Musk received his pay plan. So it's reasonable to take Musk at face value when he says his Tesla pay, as McCormick put it, is a "means of bankrolling that mission." Closer to home, Musk's legal battle could trigger a rethink of where Corporate America goes to do business.

Persons: —, Elon, Thomas Jefferson, Tesla, Richard Tornetta —, Musk, Judge Kathaleen McCormick, Musk's Tesla, Chandan Khanna, …, Judge McCormick, McCormick, DealBook, that's Organizations: Service, The, The Diamond State, Business, SpaceX, Toyota, Delaware Inc, Corporate America Locations: Delaware, The Diamond, Tesla, Mars, America's, America, Nevada, Texas

A judge just voided Elon Musk's $55 billion Tesla pay package. The ruling, which Tesla can appeal, threatens Musk's spot as the richest person in the world. AdvertisementElon Musk's wealth is facing a potential financial hit after a Delaware judge struck down the billionaire's $55 billion Tesla pay package on Tuesday, voiding the record-setting executive compensation plan. Without the $51.1 billion compensation plan, Musk's net worth would drop to roughly $154 billion, knocking him down several notches on the current list of the world's richest people, Bloomberg reported. His pay package centers around 304 million stock options in 12 tranches tied to a series of goalposts around the carmaker's financial growth, BI previously reported.

Persons: Tesla, —, Elon, Musk, Jeff Bezos, He's, Bernard Arnault, tranches, Richard Tornetta, Greg Varallo, Delaware — Elon, Angela Reddock, Wright, Cynthia Augello, Joshua Tyler White, they're, They've Organizations: Elon Musk's, Bloomberg, Service, New York Times, SEC, Vanderbilt Locations: Delaware, French, Los Angeles, New York, China

☆ Tesla shares slide after judge voids Elon Musk's $56 billion compensation
▼ + stars: | 2024-01-30 | by ( Dan Mangan | ) www.cnbc.com time to read: +1 min

Elon Musk — the CEO of Tesla and SpaceX and owner of X, formerly Twitter — speaks during the New York Times annual DealBook summit in New York City, Nov. 29, 2023. A Delaware judge on Tuesday voided the $56 billion pay package of Tesla CEO Elon Musk, ruling that the company's board of directors "failed that the compensation plan was fair." Tesla's share price slid about 3% in after-hours trading Tuesday following news of the decision in the lawsuit filed by Richard Tornetta, a shareholder in the electric automaker. "The plaintiff is entitled to rescission," Delaware Chancery Court Judge Kathaleen McCormick wrote in his ruling agreeing that Musk's pay package was inappropriately set by Tesla's board. Please check back for updates.

Persons: Elon, Twitter —, Elon Musk, Richard Tornetta, Judge Kathaleen McCormick, McCormick Organizations: SpaceX, Twitter, New York Times, Tesla Locations: New York City, Delaware

☆ Judge strikes down Elon Musk's $55 billion Tesla pay package
▼ + stars: | 2024-01-30 | by ( Grace Kay | ) www.businessinsider.com time to read: +3 min

A Delaware judge ruled against Elon Musk's $55 billion Tesla compensation package. In 2018, a Tesla shareholder sued Tesla and Musk over the pay plan. A Delaware judge ruled to strike down Musk's $55 billion Tesla compensation package on Tuesday, siding with a shareholder who had argued in a lawsuit that the CEO's pay plan was over the top. Tesla shareholder Richard Tornetta sued Tesla and Musk over the massive pay plan in 2018, arguing that it was "beyond the bounds of reasonable judgment." Meanwhile, Tesla argued that the pay was necessary to maintain Musk's focus on Tesla and that shareholders like Tornetta have benefited from Musk's leadership.

Persons: Tesla, —, Elon Musk, Musk, Kathleen St, J, McCormick, Richard Tornetta Organizations: Elon Musk's, Service, Tesla's, Tornetta, Bloomberg, Tesla Locations: Delaware

☆ Stocks making the biggest moves after hours: Microsoft, Alphabet, Starbucks, AMD and more
▼ + stars: | 2024-01-30 | by ( Hakyung Kim | ) www.cnbc.com time to read: +4 min

Electronic Arts — The stock declined 3.3% after its fiscal third-quarter revenue came in below estimates. Google ad revenue came in at $65.52 billion, short of analysts' expectations for $65.94 billion, per StreetAccount. Starbucks' fiscal first-quarter adjusted earnings came in at 90 cents per share on revenue of $9.43 billion. This fell short of analysts' expectations for 93 cents in earnings per share and revenue of $9.59 billion, per LSEG. Revenue came in at $194 million, reflecting a 53% increase from a year earlier.

Persons: Elon Musk's, Richard Tornetta, Laxman Narasimhan, Stryker, Skyworks, Liam Griffin, Robert Half, FactSet, Teradyne, Darla Mercado, Scott Schnipper Organizations: Microsoft, LSEG, Electronic Arts, EA, Google, Starbucks, AMD, Powell Industries Locations: Delaware, Asia, North America, LSEG

A Delaware judge on Tuesday voided the $56 billion pay package of Tesla CEO Elon Musk, ruling that the company's board of directors failed to prove "that the compensation plan was fair" or show much evidence that they had even negotiated with him. The pay package that Tesla granted Musk in 2018 was the largest compensation plan in public corporate history, McCormick noted in her 200-page ruling. He claims that Tesla, Inc.'s directors breached their fiduciary duties by awarding Elon Musk a performance-based equity-compensation plan." "Put simply, neither the Compensation Committee nor the Board acted in the best interests of the Company when negotiating Musk's compensation plan. But in a tweet late Tuesday afternoon, Musk wrote, "Never incorporate your company in the state of Delaware."

Persons: Elon, Twitter —, Elon Musk, Richard Tornetta, Chancellor Kathaleen McCormick, Tesla, McCormick, Musk, Tornetta, Todd Maron, Grant Organizations: SpaceX, Twitter, New York Times, Tesla, Delaware Supreme Court, Inc, Elon, Company, Musk, CNBC, CNBC PRO Locations: New York City, Delaware

☆ Lawyer dubs Elon Musk a 'part-time CEO' distracted by Twitter and SpaceX in Tesla shareholder lawsuit over $56 billion pay package, report says
▼ + stars: | 2023-02-23 | by ( Pete Syme | ) www.businessinsider.com time to read: +3 min

The final comments in a lawsuit over Elon Musk's $56 billion Tesla pay package were made Tuesday. On Tuesday, the Delaware court heard the final comments in a lawsuit over Musk's Tesla compensation package, currently valued at $56 billion. The package, plus rising Tesla stock, catapulted him to becoming the world's richest person three years later. Several Tesla shareholders have openly criticized Musk since he took over, echoing the accusation that he's not spending enough time at the electric-vehicle company. The third-largest individual investor, KoGuan Leo, said: "Elon abandoned Tesla and Tesla has no working CEO."

☆ Elon Musk is working at Tesla for free after receiving his final stock options last month
▼ + stars: | 2023-02-22 | by ( George Glover | ) www.businessinsider.com time to read: +2 min

Elon Musk doesn't draw a cash salary from Tesla because he's paid in stock options. He received the final block of options from his 2018 pay package last month, meaning he's now technically working for free. So without a cash salary or stock options, Musk isn't being paid to be Tesla's CEO right now – but don't feel too sorry for him. "The Plan designed and approved by the Board was not a typical pay package intended to compensate the ordinary executive for overseeing the day-to-day operations of a mature company." Read more: Elon Musk's lawyers are making closing arguments in a trial over his $56 billion pay package that could be decided as soon as today

☆ Elon Musk's lawyers are making closing arguments in a trial over his $56 billion pay package that could be decided as soon as today
▼ + stars: | 2023-02-21 | by ( Grace Kay | ) www.businessinsider.com time to read: +4 min

A judge will hear the closing arguments in a trial over Elon Musk's $56 billion pay plan on Tuesday. A Tesla shareholder has sued Musk and the automaker with the goal of getting the pay plan rescinded. Lawyers for Musk and Tesla investor Richard Tornetta will begin presenting their final arguments on Tuesday at 1:30 p.m. Tornetta aims to get the pay package rescinded. The result of the trial could impact not only Musk's pay package, but his other companies as well, Anat Alon-Beck, assistant professor of law at Case Western Reserve University, previously told Insider.

[1/2] Tesla vehicles are shown at a Tesla service center in San Diego, California, U.S., January 13, 2023. At Tuesday's closing arguments in a Delaware court, a judge pressed lawyers representing Tesla directors and the investor challenging Musk's pay over whether the company's explosive growth outweighed misleading disclosures about the pay plan in 2018. The pay package contributed to Musk's fortune, the world's second-largest, and has no comparison in the world of executive pay. Tesla investor Richard Tornetta sued Musk and the board in 2018, arguing it unjustly enriched Musk and should be voided. Attorneys for the Tesla directors argued that Tornetta never challenged the main details of the proxy that described the plan, such as the goals Musk had to meet.

☆ Judge to hear final arguments in trial over Musk's $56 billion Tesla pay
▼ + stars: | 2023-02-21 | by ( Tom Hals | Thomson Reuters | Award-Winning Reporter With More Than Two Decades Of Experience In International News | ) www.reuters.com time to read: +2 min

[1/2] Tesla vehicles are shown at a Tesla service center in San Diego, California, U.S., January 13, 2023. REUTERS/Mike BlakeCompanies Tesla Inc FollowWILMINGTON, Del, Feb 21 (Reuters) - Lawyers for Elon Musk and a Tesla Inc (TSLA.O) investor will make closing arguments on Tuesday in a trial over his $56 billion pay package and whether it fueled the electric carmaker's growth or improperly subsidized Musk's dream of one day traveling to Mars. The arguments follow a five-day trial in November that featured testimony from the Tesla chief executive about the origins of the 2018 pay package and whether its performance goals were difficult to achieve and accurately described to investors. Musk, who founded rocket company SpaceX, admitted during his testimony that his pay package provided funds he would use to finance interplanetary travel. His lawyers also argued the pay plan benefited shareholders by increasing the value of their stock 10 times.

[1/2] Elon Musk, Chief Executive Officer (CEO) of SpaceX, Tesla and Twitter, arrives for a trial about his Tesla pay package at the Delaware Court of Chancery in Wilmington, Delaware, U.S., November 16, 2022. "The amount of pain, no words can express," Musk testified on Wednesday. The package allows Musk to buy 1% of Tesla's stock at a deep discount each time escalating performance and financial targets are met. "It wasn't a knock-down, drag-out affair," Todd Maron testified about the pay talks in 2017 when he was general counsel. You could almost make an argument they didn't pay him enough because he ran off after Twitter."

☆ Elon Musk’s $50 billion trial comes to an end today
▼ + stars: | 2022-11-18 | by ( Matt Mcfarland | ) edition.cnn.com time to read: +5 min

Washington, DC CNN —The trial for the Tesla shareholder lawsuit examining CEO Elon Musk’s unprecedented compensation package will wrap up this afternoon. The net value of the compensation package is $50.9 billion today, after Tesla’s valuation soared more than 1,000% at its peak since shareholders approved the package. Several corporate governance experts told CNN Business that it’s clear Tesla’s board of directors lacks independence from Musk. At the time of the 2018 compensation package, Kimbal said it was “very unlikely” that Elon would walk away from his role of CEO at Tesla. That’s just not how Elon operates,” Kimbal Musk said.

☆ Elon Musk’s Tesla Compensation Trial Turns to Financial Experts in Closing Days
▼ + stars: | 2022-11-17 | by ( Rebecca Elliott | ) www.wsj.com time to read: 1 min

A five-day trial over Elon Musk’s multibillion-dollar pay package at Tesla is entering its closing days. WILMINGTON, Del.—The trial over Elon Musk‘s multibillion-dollar pay package at Tesla Inc. enters its closing days with outside financial experts poised to take the stand. Richard Tornetta, a Tesla shareholder, is seeking to nullify Mr. Musk’s 2018 pay package, alleging that the CEO controlled the board’s consideration of his grant and that the board failed to disclose crucial information to shareholders, who signed off on it.

☆ Elon Musk says 50 Tesla software engineers brought in to review Twitter's code had volunteered for the job
▼ + stars: | 2022-11-17 | by ( Pete Syme | ) www.businessinsider.com time to read: +3 min

Elon Musk told a court that 50 Tesla engineers working at Twitter weren't "Tesla assets." He said that's because the Tesla staff had volunteered to work at the company after-hours. Musk was testifying over a shareholder lawsuit which says his $55 billion pay package was excessive. When questioned if it was a good idea to use Tesla resources at Twitter, Musk said he "didn't think of this as using Tesla assets." Musk — who is the CEO of both Tesla and SpaceX, and is acting as CEO at Twitter — was in court over a Tesla shareholder lawsuit.

☆ Amid Twitter turmoil, Musk arrives in court for $56 billion Tesla pay trial
▼ + stars: | 2022-11-16 | by ( Tom Hals | ) www.reuters.com time to read: +3 min

On Monday and Tuesday, the court got a taste of Musk’s testimony through short clips from his 2021 deposition in the litigation. In one clip, Musk dismissed the idea that the board should have discussed requiring that he spend more time with Tesla. The disputed Tesla package allows Musk to buy 1% of Tesla’s stock at a deep discount each time escalating performance and financial targets are met. Tesla has hit 11 of the 12 targets, according to court papers. The Musk case survived a motion to dismiss because it was determined he might be considered a controlling shareholder, which means stricter rules apply.

☆ Amid Twitter turmoil, Musk takes stand in $56 billion Tesla pay trial
▼ + stars: | 2022-11-16 | by ( Tom Hals | ) www.reuters.com time to read: +3 min

In one clip, Musk dismissed the idea that the board should have discussed requiring that he spend more time with Tesla. He apologized from the stand to a British diver who he called “pedo guy” in a tweet and who sued Musk for defamation. The disputed Tesla package allows Musk to buy 1% of Tesla’s stock at a deep discount each time escalating performance and financial targets are met. Tesla has hit 11 of the 12 targets, according to court papers. The Musk case survived a motion to dismiss because it was determined he might be considered a controlling shareholder, which means stricter rules apply.

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