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Written by Tom Hales
WILMINGTON, Del. (Reuters) – Tesla Inc (NASDAQ:) claims Elon Musk won his legal battle over his $56 billion pay package because shareholders voted in favor of compensation, even though a judge overturned that earlier this year, according to… According to a court filing released Friday. .
The company’s filing comes two weeks after Tesla shareholders voted to ratify a 2018 stock options package. Tesla held the vote after a Delaware judge ruled in January that the compensation was voided because Musk improperly controlled the negotiation process and the company misled shareholders about key details. .
The uncertainty in this issue overwhelms Musk’s relationship with Tesla, which is suffering from slowing sales and intense competition. He said he may develop some products outside the company if he does not take a larger ownership stake.
Tesla made its case in a motion on how Delaware District Court Judge Kathleen McCormick (NYSE: ) should draft a final order required to enforce the January ruling. Tesla said the final order should provide “judgment in favor of the defendants.”
The shareholders’ legal team wants the judge to stick with her original ruling invalidating Musk’s pay package. They want her to order Tesla to pay billions of dollars worth of Tesla stock in legal fees.
Tesla said the fair fee could reach $13.6 million.
McCormick will hear oral arguments on the legal fees on July 8 and could take at least a few weeks before ruling.
Even if it does not reverse its January ruling, it may realize that the shareholder vote showed that winning the case is worthless because Tesla shareholders want the unprecedented compensation. This would undermine the plaintiff’s attorney’s fee request, which is based on the value he provided to the company by eliminating the pay package.
