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IPFS News Link • Courtroom and Trials

Delaware Judge Will Force Tesla to Pay Lawyers Billions

• https://www.nextbigfuture.com, by Brian Wang

• Tesla and Elon Musk will appeal the ruling.
• Before Elon and Tesla can appeal, the two sides will propose a final order for approval by Judge McCormick, which will include a petition for a legal fee. That legal fee, which will be paid by Tesla, is expected to be one of the largest ever—if not the largest—legal fee ever paid in history (billions). Tesla will likely oppose it.
• The fee petition is expected to be filed by March 1. If that's approved, Elon would have 60 days to file an appeal with the Delaware Supreme Court.
• An appeal is expected to take at least 6 months to resolve.

UPDATE

Tesla is negotiating with the Tesla shareholder and the lawyers. The discussion is to propose a delay to the legal fee decision until the appeal. This involves the appeal bond. IF Tesla is successful upon appeals, this would greatly reduce or eliminate the awarding of the legal fees.

An appeal bondis a payment that a court requires from an appellant when awaiting a judgment appeal. The bond's purpose is to maintain the status quo during appeal. The surety insurer guarantees to the appellee that the surety will pay the appellee if the appellant is unable to do so if the judgment is affirmed.

The 2018 Shareholder Vote

The ruling was supposedly to protect Tesla shareholders. In 2018, Tesla shareholders approved a $56 billion pay package for CEO Elon Musk with 73% of their votes, excluding votes by Elon Musk and his brother Kimbal. The lawsuit was made by a Tesla shareholder with 9 shares of Tesla stock.

The ruling was that everyone did not know that they were agreeing to pay Elon about 1% of the company in options but only starting with more than doubling the value of the company. The rest would come with triple, quadruple up to 12X the value of the company. All of the media at the time said the goals were impossible.


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