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DOVER, Del. (AP) – Lawyers who successfully argued that Tesla CEO Elon Musk’s huge salary was illegal and should be voided will be awarded $5.6 billion worth of company stock to cover legal costs. asked the presiding judge.
Lawyers representing Tesla shareholders in a case decided in January made the request to a Delaware judge in court papers filed Friday.
If approved, this amount would clearly be much larger for an award of this type. Lawyers in the class action lawsuit stemming from the Enron bankruptcy In 2008, we recorded $688 million in litigation costs.
“We are ‘ready to eat our own food,'” Tesla’s plaintiffs’ lawyers wrote in a court filing, as they worked purely on a contingent basis for more than five years. He claimed that this amount was justified. If they lost, they would have gotten nothing. The benefits for Tesla were “significant,” they said.
The requested award is equivalent to the 11% of Tesla stock Musk had sought in his compensation package, worth about $55 billion, Judge Catherine St. John ruled. Jude McCormick ruled in January that it was illegal.
Lawyers argued that the request would not only have no impact on the electric car company’s balance sheet, but would also qualify for a tax deduction. It also seeks costs of $1.1 million.
In his ruling, Judge McCormick accepted shareholder lawyers’ argument that Musk personally directed his landmark 2018 pay package. fake negotiation with non-independent directors.
That would almost double Musk’s Tesla stock. Current ownership rate is 13%.
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