Tesla CEO Elon Musk wrapped up his testimony before the Delaware Court of on Tuesday afternoon, after spending around 9 hours defending his company’s 2016 acquisition of SolarCity for $2.6 billion.
Shareholders sued Musk, alleging that Tesla’s acquisition of the solar energy installer amounted to a bailout pushed through by Musk, who was chairman of the board at both businesses concurrently. The shareholders also allege that Musk controlled the board of Tesla, even though he appeared to recuse himself from some deal negotiations concerning SolarCity.If Musk loses the lawsuit, he could have to pay upwards of $2 billion. In this case, known as a shareholder derivative action, the suit is filed by investors on behalf of a corporation, rather than the individuals or funds. If the plaintiffs win, proceeds may go to Tesla and not to the stakeholders who brought the suit.
Just after questioning began on Tuesday, plaintiffs’ attorney Randy Baron tried to paint a picture of Musk repeatedly going behind the board’s back to get a deal between the two companies started. Musk, meanwhile, insisted that all communication he had around the deal prior to board discussion was meant to provide a full picture.
