US lawyers who won case against Musk seek 5.6 billion dollars of Tesla shares

2 March 2024, 19:54

Musk Vs OpenAI
Musk Vs OpenAI. Picture: PA

The attorneys represented Tesla shareholders in the case over Elon Musk’s pay package which was decided in January.

The lawyers who successfully argued that a massive pay package for Tesla CEO Elon Musk was illegal and should be voided have asked the presiding judge to award them company stock worth 5.6 billion dollars (£4.4bn) as legal fees.

The attorneys, who represented Tesla shareholders in the case decided in January, made the request of the Delaware judge in court papers filed on Friday.

The amount would apparently be far and away the largest such award, if approved. Lawyers in class-action suits stemming from the collapse of Enron got 688 million dollars (543m) in legal fees in 2008.

Tesla Musk Compensation-Legal Fees
Elon Musk holds a 13% take in Tesla (Steven Senne/AP)

“We are ‘prepared to eat our cooking,’” the Tesla plaintiff attorneys wrote in the court filing, arguing the sum is justified because they worked purely on a contingency basis for more than five years. If they lost they would have got nothing and the benefit to Tesla “was massive”, they said.

The requested award represents 11% of the Tesla stock — worth some 55 billion dollars (£43bn) — that Mr Musk was seeking in the compensation package, which Judge Kathaleen St Jude McCormick ruled illegal in January.

Not only does the request take nothing from the electric car company’s balance sheet, it is also tax deductible, the attorneys argued.

In her ruling, Judge McCormick accepted the shareholder lawyers’ argument that Mr Musk personally dictated the landmark 2018 pay package in sham negotiations with directors who were not independent.

It would have nearly doubled Mr Musk’s stake in Tesla. He currently holds 13%.

By Press Association

Latest World News

See more Latest World News

Pro-Ukraine activists outside the Capitol in Washington

Ukrainian and Western leaders hail US aid as Kremlin warns of ‘further ruin’

People protest in Tel Aviv against Benjamin Netanyahu's government

Israeli strikes on southern Gaza city of Rafah kill 18, mostly children

A woman casts her vote at a polling station in Male

Voting begins for Maldives Parliament, as India and China vie for influence

Flowers left inside the Westfield shopping centre in Bondi Junction, Sydney, where the stabbing took place

Nine-month-old baby hurt in Sydney mall stabbing out of hospital, health authorities say

The two children were pronounced dead at the scene

Siblings, 8, and 5, killed and 15 others injured after suspected drunk driver smashes into children's birthday party

An SH-60K helicopter

One dead, seven missing after two Japanese navy helicopters crash in Pacific

Ecuador Security Referendum

Ecuadorians head to polls to toughen fight against gangs behind wave of violence

Birthday Party Crash

Two children dead and 15 injured after truck crashes into child’s birthday party

United States Ukraine Weapons Explainer

US lawmakers approve multibillion-dollar aid package for Ukraine and Israel

Congress TikTok

US lawmakers pass legislation to ban TikTok within a year

Mideast Tensions Satellite

Iranian attack damaged taxiway at Israeli air base, satellite image shows

China Kite Festival Photo Gallery

In Pictures: Colourful creations fill sky at Chinese kite festival

People pass by a damaged electric pole caused by flooding due to heavy rains in Pakistan

Pakistani province issues flood alert and warns of heavy loss of life

Russian rockets are launched against Ukraine from Russia’s Belgorod region

Ukrainian drones targeting Russian power stations shot down, says Moscow

Speaker of the House of Representatives Mike Johnson

US House of Representatives on brink of approving aid for Ukraine and Israel

Nigeria Chess Education

Nigerian chess champion plays game for 60 hours in new global record bid