{"id":11617,"date":"2024-03-05T17:47:48","date_gmt":"2024-03-05T17:47:48","guid":{"rendered":"https:\/\/ugandaupdatenews.com\/?p=11617"},"modified":"2024-03-05T17:47:52","modified_gmt":"2024-03-05T17:47:52","slug":"lawyers-seek-nearly-6-billion-in-tesla-stock-after-getting-musk-pay-package-struck-down","status":"publish","type":"post","link":"https:\/\/prowebinhost.com\/anzu\/lawyers-seek-nearly-6-billion-in-tesla-stock-after-getting-musk-pay-package-struck-down\/","title":{"rendered":"Lawyers seek nearly $6 billion in Tesla stock after getting Musk pay package struck down"},"content":{"rendered":"\n

The fee would be a record-shattering amount. The attorneys successfully argued against the CEO’s $56 billion pay package from 2018.<\/strong><\/p>\n\n\n\n

Lawyers <\/strong>asked a Delaware judge to award them Tesla<\/a> stock worth nearly $6 billion as of Friday as their fee for successfully arguing that CEO Elon Musk\u2019s 2018 <\/strong>pay package was unlawful.<\/p>\n\n\n\n

The fee would dwarf records for attorney paydays if a judge approves it. Lawyers who worked on Enron-related class actions were awarded $688 million in fees<\/a> in 2008.<\/p>\n\n\n\n

The lawyers had earlier convinced the Delaware chancery court to revoke Musk\u2019s $56 billion<\/a> pay package from 2018, with the judge ruling that Tesla\u2019s board of directors failed to prove it was fair to shareholders.<\/p>\n\n\n\n

On Friday, in a petition for fees and expense reimbursement filed to that court, the attorneys argued that the fee would be justified given how much value they delivered to Tesla shareholders. The lawyers represent former heavy metal drummer Richard Tornetta, who filed the suit on behalf of his fellow Tesla investors.<\/p>\n\n\n\n

The lawyers are asking for just over 11% of the Tesla shares that would have gone to Musk, or slightly more than 29.4 million shares. Tesla\u2019s stock closed Friday at $202.64 per share, meaning the fee would be worth about $5.96 billion.<\/p>\n\n\n\n

Taking their pay in Tesla shares demonstrates they are prepared to \u201ceat our cooking,\u201d the lawyers wrote.<\/p>\n\n\n\n

They added: \u201cThis structure has the benefit of linking the award directly to the benefit created and avoids taking even one cent from the Tesla balance sheet to pay fees. It is also tax-deductible by Tesla.\u201d<\/p>\n\n\n\n

The shares they\u2019re asking for would be freely tradeable, they noted, while Musk\u2019s stock options included a five-year holding period starting from when he exercised them.<\/p>\n\n\n\n

Still, the lawyers described the nearly $6 billion in shares as \u201cconservative\u201d under Delaware law, which they said entitles them to 33% of the \u201cquantifiable conferred benefit.\u201d<\/p>\n\n\n\n

\u201cNevertheless, in an effort to be conservative, Plaintiff\u2019s Counsel does not seek the 33%\u201d warranted by previous cases, they wrote.<\/p>\n\n\n\n

They noted that they took the case on a contingency basis and would have gotten nothing if they had lost.<\/p>\n\n\n\n

\u201cPlaintiff\u2019s Counsel have not been paid for their work, nor have any of their costs or expenses been reimbursed, and litigating this Action required the allocation of a substantial amount of Plaintiff\u2019s Counsel\u2019s time and resources over six years, including considerable out-of-pocket expenses,\u201d they wrote.<\/p>\n\n\n\n

Greg Varallo, lead counsel for the plaintiffs and the lawyer who signed the brief, did not immediately respond to a request for further comment. He\u2019s the head of the Delaware practice for the law firm Bernstein Litowitz Berger & Grossmann. <\/p>\n\n\n\n

Representatives for Musk and Tesla also did not immediately respond to requests for comment. <\/p>\n\n\n\n

The lawyers wrote that throughout the history of the case, they collectively logged 19,499.95 hours \u2014 meaning that a nearly $6 billion award would equal a per-hour rate of $305,550. They argued, though, that the hours worked was of secondary importance, if it was worth considering at all.<\/p>\n\n\n\n

\u201cDelaware seeks to incentivize, not punish, efficient litigation,\u201d they wrote.<\/p>\n\n\n\n

The lawyers, based in Delaware and New York, are also asking for an expense reimbursement of $1.1 million.<\/p>\n\n\n\n

Musk\u2019s pay package was the largest ever disclosed in corporate America, according to Delaware Chancery Court Judge Kathaleen McCormick\u2019s 200-page ruling<\/a>. She said that the process leading to the package was \u201cdeeply flawed\u201d in part because Musk drove the process for determining it, and it was agreed upon by Tesla board members \u201cwho were beholden to Musk.\u201d<\/p>\n\n\n\n

Musk is\u00a0expected to appeal<\/a>\u00a0the ruling. The CEO and centibillionaire has also said he will seek to\u00a0move Tesla\u2019s site of incorporation to Texas<\/a>.<\/p>\n\n\n\n

Editor:msserwanga@gmail.com<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

The fee would be a record-shattering amount. The attorneys successfully argued against the CEO’s $56 billion pay package from 2018.<\/p>\n","protected":false},"author":1,"featured_media":11618,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[129],"tags":[],"class_list":["post-11617","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legal"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/prowebinhost.com\/anzu\/wp-content\/uploads\/2024\/03\/240119-elon-musk-al-1304-d49c0a.webp","jetpack-related-posts":[{"id":16128,"url":"https:\/\/prowebinhost.com\/anzu\/stop-taxing-social-clubs-like-pope-paul-court-orders-ura-in-kla-club-vat-case\/","url_meta":{"origin":11617,"position":0},"title":"Stop taxing social clubs like Pope Paul, Court Orders URA in K\u2019la Club VAT Case","author":"UgandaUpdate","date":"December 13, 2025","format":false,"excerpt":"In a 14-page judgment, Ag Judge Susan Odongo of the Commercial Division of the High Court has famously set aside the Tax Appeals Tribunal (TAT) 31st\u00a0October 2023 decision authorizing Uganda Revenue Authority (URA) to enforce recovery of Shs166,541,103 from Kampala Club. 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While allowing the application by the banks\u2019 lawyers to stay\u2026","rel":"","context":"In "Business"","block_context":{"text":"Business","link":"https:\/\/prowebinhost.com\/anzu\/category\/business\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3084,"url":"https:\/\/prowebinhost.com\/anzu\/ntagali-ex-lovers-man-demands-half-a-billion-shillings-from-rtd-archbishop\/","url_meta":{"origin":11617,"position":3},"title":"NTAGALI EX LOVER’S MAN DEMANDS HALF A BILLION SHILLINGS FROM RTD ARCHBISHOP","author":"UgandaUpdate","date":"April 28, 2021","format":false,"excerpt":"BY Our Reporters in Kabale \u00a0The woes of retired Church of Uganda Archbishop Stanley Ntagali are not yet \u00a0over after Rev Christopher Tugumehabwe whose\u00a0 wife he \u00a0allegedly had an extra-marital affair with has through his Kabale based lawyers threatened to add him as a party to his divorce -cross petition\u2026","rel":"","context":"In "National News"","block_context":{"text":"National News","link":"https:\/\/prowebinhost.com\/anzu\/category\/national-news\/"},"img":{"alt_text":"","src":"https:\/\/prowebinhost.com\/anzu\/wp-content\/uploads\/2021\/04\/ntagali-1-2.jpg","width":350,"height":200,"srcset":"https:\/\/prowebinhost.com\/anzu\/wp-content\/uploads\/2021\/04\/ntagali-1-2.jpg 1x, https:\/\/prowebinhost.com\/anzu\/wp-content\/uploads\/2021\/04\/ntagali-1-2.jpg 1.5x, https:\/\/prowebinhost.com\/anzu\/wp-content\/uploads\/2021\/04\/ntagali-1-2.jpg 2x, https:\/\/prowebinhost.com\/anzu\/wp-content\/uploads\/2021\/04\/ntagali-1-2.jpg 3x"},"classes":[]},{"id":6485,"url":"https:\/\/prowebinhost.com\/anzu\/six-vie-for-the-uganda-law-society-presidency-as-lawyers-go-to-polls-on-september-10th2022\/","url_meta":{"origin":11617,"position":4},"title":"SIX VIE FOR THE UGANDA LAW SOCIETY PRESIDENCY AS LAWYERS GO TO POLLS ON SEPTEMBER 10th,2022","author":"UgandaUpdate","date":"August 25, 2022","format":false,"excerpt":"Its ten days to the election of a new President of the\u00a0 Uganda Law Society to replace Ms Wall Nabasa, who has served her two terms . 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