The shareholder's lawyers argue that the compensation package should be voided because it was dictated by Musk and the product of sham negotiations with...
WILMINGTON, Del. — Attorneys for a Tesla shareholder urged a Delaware judge on Tuesday to invalidate a 2018 compensation package awarded by the company’s board of directors to CEO Elon Musk that is potentially worth more than $55 billion.
Delaware courts often defer to the “business judgment” of corporate directors in decision-making absent a showing of wrongdoing. But attorney Greg Varallo argued that the Tesla TSLA defendants should be required to show that the compensation plan was “entirely fair” to stockholders because Musk was a controlling shareholder.
Musk also downplayed the notion that his friendships with certain Tesla board members, including sometimes vacationing together, mean that they were likely to do his bidding. Varallo told Chancellor Kathaleen St. Jude McCormick that Musk should be force to give back some, if not all, of the stock option grants he has earned.
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