Judge who nixed Musk's pay package hears arguments on massive fee request from plaintiff lawyers
A Delaware judge is considering a massive and unprecedented fee request by lawyers who successfully argued that a massive and unprecedented pay package for Tesla CEO Elon Musk should be voided
WILMINGTON, Del. — A Delaware judge heard arguments Monday over a massive and unprecedented fee request by lawyers who successfully argued that a massive and unprecedented pay package for Tesla CEO Elon Musk was illegal and should be voided.
Attorneys for a Tesla stockholder who challenged Musk’s 2018 compensation package are asking Chancellor Kathaleen St. Jude McCormick to award them legal fees in the form of stock in the electric vehicle company valued at more than $7 billion at current trading prices. The 2018 compensation package for Musk that was rescinded by the judge was potentially worth more than $55 billion.
After a full day of expert-witness testimony and arguments by attorneys, McCormick gave no indication on when she would rule on the fee request.
The fee amount sought by plaintiffs’ attorneys dwarfs the current record $688 million in legal fees awarded in 2008 in litigation stemming from the collapse of Enron.
Attorneys for the Tesla shareholder argue that their work resulted in the “massive” benefit of returning shares to Tesla that otherwise would have gone to Musk and diluted the stock held by other Tesla investors. They value that benefit at $51.4 billion, using the difference between the stock price at the time of McCormick’s January ruling and the strike price of some 304 million stock options granted to Musk.
Attorney Greg Varallo told McCormick that he and his fellow plaintiff lawyers were simply asking for “a slice of the value pie we created.”
“We did battle with the very best,” Varallo added. “Litigation
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