Tesla Investors Ask Judge To Order CEO Elon Musk To Repay $13 Billion For SolarCity Deal
On Tuesday, Tesla shareholders urged a judge to find that CEO Elon Musk coerced the company’s board into a 2016 deal for SolarCity. They have asked that Musk be ordered to pay the EV company $13 billion.
“This case has always been about whether the acquisition of SolarCity was a rescue from financial distress, a bailout orchestrated by Elon Musk,” Randy Baron, an attorney for shareholders, said.
The lawsuit by union pension funds and asset managers claims that Musk pushed the Tesla board to approve the SolarCity deal. At the time, Musk was the top shareholder in the cash-strapped solar energy company.
However, Musk argued that the SolarCity deal was part of a decade-old master plan to create a vertically integrated company to transform energy generation and consumption with SolarCity’s solar panels and Tesla’s electric vehicles and batteries.
In 2016, the all-stock deal was valued at $2.6 billion, but Tesla’s stock has rocketed since. Shareholder attorney Lee Rudy urged Vice Chancellor Joseph Slights of Delaware’s Court of Chancery to order Tesla’s CEO to return the company stock he received. Presently, this would be worth approximately $13 billion.