Elon Musk’s robust compensation plan may have a mystery author, and details could become a major annoyance for the Tesla CEO and SpaceX founder because of an ongoing court case.
On Monday in Dover, Del., Vice Chancellor Joseph Slights Jr. ruled that Tesla must hand over documents containing discussions between Musk and Tesla’s in-house counsel regarding a compensation plan that could reward Musk more than $50 billion if certain business milestones are met.
Musk presented the compensation plan to Tesla’s board of directors in 2018.
An Associated Press report said Slights’ decision held that those communications between Musk and his in-house counsel are not protected. He did, however, rule that additional documents requested by the plaintiffs remained protected.
The accusations center on Musk’s alleged attempts to keep his plan intact without the Tesla board of directors having any input.
Shareholders believe the plan was produced by Tesla’s in-house counsel, Todd Maron, and deputy in-house counsel, Jonathan Chang.
Tesla has denied the claims.
“Leveraging his control, close personal relationships, and reputation for retribution, Musk co-opted Maron and Chang to help him structure the plan free from committee involvement,” the plaintiffs’ attorneys wrote in motions, according to the AP. “Musk and his agents handed the committee a fully baked plan.”
The AP story quotes attorney Gregory Varallo’s address to Slights: “Whose idea was the largest compensation plan ever designed?
“If you read the record to date, no one seems to know,” said Varallo. “There was quite a lot of sausage-making taking place before this was even a twinkle in the eye of the compensation committee.”
Vanessa Lavely, an attorney representing Tesla, told Slights the board acted appropriately regarding the compensation plan.
“There was absolutely no rubber-stamping here, and the defendants look forward to the opportunity to present this record to the court,” she said.
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