Elon Musk, Tesla board sued over alleged excessive compensation
While Musk doesn't take a salary, the lawsuit alleges the Tesla board members awarded themselves massive compensation packages at the expense of the carmaker.
Tesla CEO Elon Musk and the electric carmaker's board of directors received a new lawsuit after a pension fund alleged the executives awarded themselves massive compensation packages at the automaker's expense.
The pension fund, which represents the Detroit police and fire departments, is an investor in Tesla and argues the automaker's board funneled hundreds of millions of dollars out of Tesla itself to dish out lofty compensation packages, Bloomberg reported Thursday.
"They have granted themselves millions in excessive compensation and are poised to continue this unrelenting avarice into the indefinite future," the lawsuit reads in part. Tesla did not immediately respond to Roadshow's request for comment.
The lawsuit goes on to say the wildly inappropriate compensation began in 2017, and in 2018, Tesla's two board members who do not work for the automaker received stock grants worth over $8.7 million that year alone. The lawsuit follows another complaint filed in 2018 that argued Musk's incredibly aggressive pay package should not move forward. The separate lawsuit also called for the board to reorganize to provide better protection for Tesla investors. Bloomberg reported the case will head to trial in October 2021.
Musk does not take a salary at Tesla, but he does receive stock payouts based on the automaker's performance. The CEO achieved all requirements for the first payday earlier this year, which likely earned Musk over $700 million. Should he meet every target to unlock each payday, Musk could earn $50 billion in stock grants.
