Elon Musk may have narrowly avoided going to court over his $44 billion purchase of Twitter but he is heading to court later this month to defend his $56 billion pay package from Tesla.
The trial was triggered by a lawsuit filed by Tesla shareholder Richard Tornetta who claims that the pay package unjustly enriches Musk without requiring his full-time presence at Tesla. He also claims that the Tesla board set easy performance targets for Musk to achieve and that the entrepreneur created the package to fund his dream of colonizing Mars.
Read: Tesla’s Board To Face Trial Over Elon Musk’s Multi-Billion Pay Package
Musk’s trial will start on November 14 and be decided in Delaware’s Court of Chancery by Kathleen McCormick, the same judge who oversaw Twitter’s lawsuit against Musk that ended last month when the world’s richest man decided to fully through with his commitment to purchase the social media network.
Lawyers representing Tornetta claim that Musk serves as a “part-time CEO” at Tesla, citing previous testimony that he worked Tuesday, Wednesday, and Friday at Tesla and then Monday and Thursday at SpaceX. Tesla asserts that the purpose of the pay package was not for Musk to work specific hours each week but instead to hit “audacious” targets that didn’t just enrich Musk but also Tesla shareholders, Reuters reports.
Tornetta asserts that the package was developed and approved by Tesla’s board of directors who are beholden to Musk and promoted to shareholders, even though internal projections indicated that the first tranches were likely going to be met.
The pay package allows Musk to purchase 1 percent of Tesla’s stock at a deep discount each time the carmaker hits performance and financial targets. Tesla has hit some 11 of these 12 targets and Musk’s vested grants are worth around $50 billion. This package of stock grants is larger than the combined pay of the 200 highest-paid CEOs in 2021, six times over.