Tesla shareholder sues Musk to return billions in alleged unlawful profits

Source: Reuters

Tesla shareholder sues Musk to return billions in alleged unlawful profits

Reuters
Tue, June 11, 2024 at 7:57 PM EDT·2 min read

WILMINGTON, Delaware (Reuters) -Elon Musk made billions of dollars by selling Tesla stock using insider information, an institutional shareholder accused in a lawsuit filed on Tuesday, asking the court to direct the Tesla CEO to return "unlawful profits."

The lawsuit comes two days before a critical vote by Tesla shareholders on whether to reinstate Musk's $56 billion pay package, after a Delaware judge voided it in January because she found that Musk had improperly controlled the process.

Musk and his brother, Kimbal Musk, a Tesla director, sold a combined $30 billion in the electric vehicle maker's stock between late 2021 and the end of 2022, cashing in before news that would cause the stock to fall became public, according to the lawsuit, which was filed by the Employees' Retirement System of Rhode Island (ERSRI).

Musk sold the shares at artificially inflated prices by concealing his plan to use the proceeds to buy social media platform Twitter, which he later renamed X, according to the lawsuit, filed at the Delaware Chancery Court. Musk also sold Tesla stock when he knew that deliveries of Tesla cars had fallen far below public projections, the lawsuit said.

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Read more: https://news.yahoo.com/news/tesla-shareholder-sues-musk-return-235741721.html