On Tuesday local time, an institutional shareholder accused Elon Musk of selling stocks through insider information and earning billions of dollars in illegal profits in a joint lawsuit, and requested the court to order him to return the illegal profits. The lawsuit came on the eve of a critical vote by Tesla shareholders on whether to restore Musk's $56 billion salary. In January of this year, a judge in Delaware declared the compensation plan invalid. According to a lawsuit filed by the Rhode Island Employee Retirement System (ERSRI), Musk and his brother, Tesla board member Kimbal Musk, sold $30 billion worth of company stock from the end of 2021 to the end of 2022 and cashed in before news emerged that caused the company's stock price to fall. According to a lawsuit filed in Delaware's Chancery Court, Musk sold the shares at artificially inflated prices and concealed his plan to use the money to buy the social media platform Twitter, which he later renamed X. The lawsuit alleges that Musk also sold Tesla stock when he knew the company's delivery volume was well below public expectations.$Tesla (TSLA.US)$The institutional shareholder accused Elon Musk of selling stocks through insider information and earning billions of dollars in illegal profits in a joint lawsuit and requested the court to order him to return the illegal profits.
The lawsuit came on the eve of a critical vote by Tesla shareholders on whether to restore Musk's $56 billion salary. In January of this year, a judge in Delaware declared the compensation plan invalid.
According to a lawsuit filed by the Rhode Island Employee Retirement System (ERSRI), Musk and his brother, Tesla board member Kimbal Musk, sold $30 billion worth of company stock from the end of 2021 to the end of 2022 and cashed in before news emerged that caused the company's stock price to fall.
According to a lawsuit filed in Delaware's Chancery Court, Musk sold the shares at artificially inflated prices and concealed his plan to use the money to buy the social media platform Twitter, which he later renamed X. The lawsuit alleges that Musk also sold Tesla stock when he knew the company's delivery volume was well below public expectations.
The Rhode Island Employee Retirement System holds about 140,000 shares of Tesla stock. On Tuesday, Tesla's stock closed at $170.66, valuing these shares at about $24 million.
Last month, another Tesla shareholder, Michael Perry, filed a similar lawsuit in the same court, accusing Musk of insider trading when he sold over $750 million worth of Tesla stock at the end of 2022.
The Rhode Island Employee Retirement System's lawsuit on Tuesday also stated that Musk had been disloyal to Tesla in several incidents, including transferring Tesla employees to X and causing Tesla to begin paying advertising fees after acquiring the platform.
The financial director of the Rhode Island Employee Retirement System said in a statement that the fund is concerned that the Tesla board of directors is not doing enough to oversee Musk's conflict of interest.
Editor / ruby