Billionaire Ilon Musk said in court that “great engineers will only work for a great engineer,” reports CNBC. According to the businessman, he never wanted to be the head of any company and does not want to be the head of Tesla. A shareholder of the electric car maker disputes Musk’s remuneration as head of the company, and the billionaire has to explain his role in Tesla, SpaceX and Twitter to the court
Telsa and SpaceX CEO and Twitter CEO Elon Musk testified in court that Tesla shareholder Richard Tornetta is appealing the amount of Musk’s compensation as the head of the electric-car maker. Musk said that he never wanted to be the CEO of any company, does not want to be the CEO of Tesla and only temporarily headed Twitter. The billionaire acknowledged that his first duty was that of a great engineer, not a CEO, saying that “great engineers will only work for a great engineer,” CNBC reported.
The lawsuit in Delaware stems from a 2018 investor-approved compensation package for Tesla’s CEO that the company gave him, an unprecedented compensation plan that made Musk a billionaire and the richest man on the planet. A shareholder in electric car maker Tornetta sued Musk and Tesla – he believes the CEO’s compensation was excessive and its approval by Tesla’s board of directors amounted to a deception of investor confidence.
Musk told the court that at SpaceX he is responsible for developing rockets and at Tesla he is responsible for the technology in the car that makes it successful. He said the CEO’s role is most often business-oriented, but his role is that of an engineer “developing technology and making sure that we develop breakthrough technologies and that we have a team of incredible engineers who can achieve those goals.” “In my experience, great engineers will only work for a great engineer. That’s my first responsibility, not the CEO’s,” he said in court.
Asked by the plaintiff’s attorneys, Musk said he encouraged Tesla employees to help him on Twitter on a “voluntary basis” and to work “after hours” on Twitter. He added that no Tesla board member called him to say that using Tesla’s resources for one of his other private companies was a bad idea. “I didn’t think of it as using Tesla’s assets. The company employs 120,000 people. That’s minimal,” Musk said. Tesla has taken more time than anything in recent years, the billionaire said.
Musk also had to explain in court his position vis-à-vis regulators, including the Securities and Exchange Commission (SEC). “Overall, I think the SEC’s mission is good, but the question is whether that mission is being done well,” the billionaire said. He cited the collapse of the cryptocurrency exchange FTX, which caused investors to “lose billions.” “Yet the SEC keeps hounding me, even though the shareholders are getting a lot of reward. It doesn’t make sense,” Musk added.
Tornetta asked the court to overturn the $56 billion bounty package for Musk, which was decided in 2018. The case is being heard by Delaware Court of Chancery Chancellor Judge Kathleen McCormick, who oversaw the litigation between Twitter and Musk, Reuters reported earlier this week. The plaintiff hopes to prove in court that Musk used his dominant position on Tesla’s board of directors to design the 2018 options package and trick investors into approving it. According to the plaintiff, Musk dictated the terms of the deal to fund his dream of traveling to Mars.
The challenged package allows Musk to buy 1% of Tesla stock at a deep discount every time growth in business performance and financial goals are achieved. Otherwise, Musk gets nothing. According to documents presented to the court, Tesla achieved 11 of its 12 goals, the company’s market value briefly increased from $50 billion to more than $1 trillion. A judgment in the case can be issued up to three months after the trial ends and can be appealed to the Delaware Supreme Court.