VCG
Three law firms have asked a US court in Delaware to award them Tesla (NASDAQ:TSLA) stock worth nearly $6 billion as a fee for successfully getting Elon Musk's $55 billion pay package overturned.
On January 30, Delaware Court of Chancery Chief Judge Kathaleen McCormick canceled a stock option grant based on 2018 performance worth $55 billion owed to Musk after a shareholder lawsuit claimed the package was improperly approved.
That shareholder lawsuit was filed by former heavy metal drummer Richard Tornetta on behalf of his fellow Tesla (TSLA) investors.
The three law firms are Bernstein, Litowitz, Berger & Grossmann and Friedman Oster & Tejtel, based in New York, and Andrews & Springer, based in Wilmington, Delaware.
“After extensive motions practice, discovery seeking, and a full trial on the merits, followed by a brief, oral argument, and supplemental brief, plaintiff obtained full rescission of the largest salary package ever issued,” the plaintiffs said. signatures on a joint presentation in the Delaware Court of Chancery on Friday.
The law firms are asking for just over 11% of the shares that would otherwise have gone to Musk as part of his pay package, or about 29.4 million shares. Based on Tesla's (TSLA) latest closing stock price of $202.64, the fee amounts to $5.96 billion. If awarded, it would be the biggest payday for lawyers in a corporate case.
“We recognize that the requested fee is unprecedented in terms of absolute size,” the law firms said in the filing.
Musk intervened in the development. “The lawyers who did nothing but harm Tesla (TSLA) want $6 billion. Criminal,” said the billionaire businessman on X (formerly Twitter). In a separate response to another user's post, Musk said that “the system is broken. It's best to get out of Delaware as soon as possible.”
