Elon Musk trial opens to decide fate of his US$56 billion Tesla pay
- A Tesla shareholder hopes to prove during the five-day trial that Musk used dominance over the board to dictate terms that did not require him to work full time
- The shareholder, Richard Tornetta, has asked the court to rescind the pay package, which is six times larger than the top 200 CEO salaries combined in 2021
Tesla CEO Elon Musk is scheduled to take the stand this week to defend his US$56 billion pay package against shareholder allegations it was rigged with easy performance targets and that investors were duped into approving it.
A Tesla shareholder hopes to prove during the five-day trial that Musk used his dominance over the electric vehicle maker’s board to dictate terms of the 2018 package, which did not even require him to work at Tesla full time.
The shareholder, Richard Tornetta, has asked the court in Wilmington, Delaware, to rescind the pay package, which is six times larger than the top 200 CEO salaries combined in 2021, according to Amit Batish of Equilar.
Musk and Tesla’s directors, who are also defendants, have denied the allegations. They argued the pay package did what it aimed to do – ensure the entrepreneur successfully guided Tesla through a critical period which helped drive the stock 10-fold higher.
Musk, the world’s richest person, could testify as soon as Tuesday, according to a court filing.
The case will be decided by Chancellor Kathaleen McCormick of Delaware’s Court of Chancery. She oversaw the legal dispute between Twitter and Musk that ended with his purchase of the social media platform for US$44 billion last month.