
After five days of testimony, including a three-hour hearing from Elon Musk, a Delaware judge will now decide whether Musk is owed $56 billion by Tesla Inc. whether it was justified by the explosive growth of the company or undermined by a flawed process, writes Reuters.
Musk and Tesla executives, named as defendants, have repeatedly said the package achieved what it was intended to do — a 10-fold increase in the company’s stock price, enriching investors and Musk.
“We thought that if we could do this, if this plan went through, Tesla would become one of the most valuable technology companies,” Antonio Gracias, a member of Tesla’s board from 2007 to 2021, in a Delaware court. “It was a great deal for shareholders,” he added.
The lawsuit seeks to resolve shareholder Richard Tornetta’s claims that the 2018 pay package was dictated by Musk, the world’s richest man, to servile executives and approved by a vote of misled shareholders.
The lawsuit ended Friday as Musk tries to control Twitter Inc.’s chaotic overhaul.
Elon Musk seems to have no emotions / When will we make a decision?
“In my opinion, even if the case goes to trial, the ruling will be in Mr. Musk’s favor,” said Eric Talley, a professor at Columbia Law School who handled the case.Save the working version
It will be months before Judge McCormick rules, and her decision can be appealed to the Delaware Supreme Court.
During the week-long trial, executives said the pay package was meant to ensure Musk would get the electric car maker through a critical phase when he could focus on his rocket company SpaceX or The Boring Co.
Musk told the board of supervisors that he wanted a huge package to finance his dream of a trip to Mars.
Musk described his efforts to push the company from the brink of collapse in 2017 to exponential growth as a gigantic effort. “The amount of pain is indescribable,” Musk said Wednesday.
Gracias recalled that Musk celebrated his birthday in the plant’s conference room with a cake from a grocery store. “It was a situation where everyone was at work, 24/7, a brutal schedule,” he told the court.
The package allows Musk to buy 1 percent of Tesla stock at a significant discount each time additional financial and performance goals are met. Otherwise, Musk will get nothing.
Tesla achieved 11 of its 12 goals, and its value briefly rose from $50 billion to more than $1 trillion.
Tornetta wants to cancel the plan and return the shares received under the plan to Tesla.
Much of the process focused on information provided to shareholders before they approved the plan. Tornetta’s lawyers tried to show that Tesla hid the fact that the package’s three goals were likely to be met quickly.
The plaintiff presented the executives as Musk’s personal friends or business partners.

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