Elon Musk testifies in Tesla shareholder lawsuit over SolarCity acquisition

Elon Musk, Founder and Chief Engineer of SpaceX, speaks in the course of the Satellite tv for pc 2020 Convention in Washington, DC, United States on March 9, 2020.

Yasin Ozturk | Anadolu Company | Getty Photographs

WILMINGTON, DEL. — Tesla CEO Elon Musk defended his function within the firm’s $2.6 billion acquisition of SolarCity in court docket Monday, arguing he did not have any undue strain on the deal.

Shareholders within the go well with allege the 2016 deal amounted to a SolarCity bailout, suing Musk and his fellow board members. Whereas the Tesla board members settled in late 2020 for $60 million, Musk opted to take the battle to court docket. Musk’s testimony, which started simply after 9:20 a.m. ET, kicked off what is anticipated to be a two-week trial in Wilmington, Delaware, in entrance of Vice Chancellor Joseph Slights. 

If Musk loses, he may need to pay upwards of $2 billion. Nonetheless on this case, often called a shareholder spinoff motion, the go well with is filed by buyers on behalf of an organization, moderately than the people or funds themselves. If the plaintiffs win, proceeds might go to Tesla and to not the stakeholders who introduced the go well with.

The large image query the trial will deal with is whether or not Musk acted in the perfect pursuits of Tesla’s shareholders, or whether or not he was making and urging choices that will extra so profit himself, his household and different firms he was concerned in — SolarCity and SpaceX.

Musk mentioned in his testimony that the acquisition didn’t quantity to a bail out, saying there was no monetary achieve. He additionally mentioned he did not put strain on fellow board members.

“Because it was a stock-for-stock transaction and I owned nearly precisely the identical proportion of each there was no monetary achieve,” Musk instructed his lawyer on the stand. He added that he did not management the appointment of board members, their removing or their compensation.

Musk mentioned the SolarCity deal was a part of his “grasp plan,” which he had written in 2006.

The CEO has a historical past of cantankerous interactions with attorneys, and federal regulators. That was extra obvious as soon as lawyer Randy Baron started cross inspecting. Baron started his time in court docket displaying clips of Musk’s deposition, repeatedly calling the go well with a waste of time.

Musk’s testimony is anticipated to proceed all through the day on Monday.

It is a growing story. Please refresh for updates.

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