A suit between a Tesla shareholder, Elon Musk and the Tesla board of directors will go to trial over Musk’s 2018 pay package.
The 2018 pay package consisted of 101.3 million stock options in 12 milestone-based tranches for the Tesla CEO. Musk would only be paid if Tesla hit the various market value and operations-based milestones.
Tesla shareholder Richard J. Tornetta sued Musk and Tesla’s board, claiming the authorization of the package amounted to a breach of the board’s fiduciary duty, reports CNBC.
As per the suit, Tornetta alleges that Tesla board members had undisclosed conflicts. It also asserts that Musk crafted his pay plan with help from Tesla’s general counsel Todd Maron.
In addition, the suit alleges that Tesla’s board did not disclose all the information to shareholders before the proxy vote to approve the plan.
Tornetta hopes to invalidate the option grant.
The suit will go to trial on April 18 in the Delaware chancery court. However, that trial date could move.
Both Tesla and attorneys representing Tornetta declined to comment on the ongoing suit.
