The appropriate course of action to settle the lawsuit and pay the CEO of the firm is a point of contention between Tesla and the legal team representing shareholder Richard Tornetta, who filed the lawsuit about the compensation package.
On June 13, Tesla's shareholders cast their votes in support of the package of stock options.
The firm said in a document that was made public on Friday that a Delaware court ought to acknowledge a vote by Tesla shareholders in support of Elon Musk's $56 billion compensation package and overturn her January decision that nullified the payment.
Furthermore, according to a document in Delaware's Court of Chancery, Chancellor Kathaleen McCormick should not take into account a request for a record $6 billion legal fee made by the attorneys who spearheaded the action against Musk's 2018 pay package.
The appropriate course of action to settle the lawsuit and pay the CEO of the firm is a point of contention between Tesla and the legal team representing shareholder Richard Tornetta, who filed the lawsuit about the compensation package.
Musk's statement earlier this year that he would rather manufacture certain products outside of Tesla unless he had a greater share in the firm raised doubts about his future at a time when Tesla is facing slower sales and more fierce competition.
On June 13, Tesla's shareholders cast their votes in support of the package of stock options. Many investors expressed their opinion that Musk deserved to be compensated, citing the company's growth in value of almost ten times after the compensation package was first agreed upon in 2018.
In the court brief, Tesla said that the judge need to ascertain the significance of the shareholder vote, so potentially significantly lowering the legal cost.
It said that it should now win the lawsuit and that it intends to file a move to overturn the January decision.
The business claims that by having an impartial board member assess the compensation plan and having shareholders accept it again, McCormick's findings—that Musk controlled the pay talks and that shareholders were misinformed during the 2018 vote—were addressed.
That strategy has been dismissed by Tornetta's legal team. They said that there was little legal significance to the shareholder vote on Musk's compensation, and even Tesla admitted that the procedure for overturning a court decision by a vote was "novel."
The next stage in the litigation is for the shareholder attorneys to get a determination about their legal expenses.
As to Tesla, the company's value was at $56 billion at the time of the compensation package's last milestone. At Friday's share price of $182.19, the bundle is valued at over $48 billion.
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