Elon Musk to Defend Tesla’s SolarCity Acquisition in Court Next Week
A pending trial against Tesla and Elon Musk was postponed last year due to the initial lockdowns from the COVID-19 pandemic, but according to a new update, Musk is expected to go to court later this month.
Elon Musk is set to appear in court on July 12, as a defendant in Tesla’s acquisition of SolarCity, a solar company owned by Musk’s cousins, according to Business Insider. Tesla acquired the company in 2016, but Tesla shareholders filed a suit the following year, alleging that Musk and Tesla’s board bailed out SolarCity through the acquisition.
Tesla Will Ask Pennsylvania Judge to Transfer Solar Lawsuit to California https://t.co/bOsmpI3MRR
— TeslaNorth.com (@RealTeslaNorth) June 3, 2021
SolarCity was founded and run by Musk’s cousins, Lyndon Rive and Peter Rive and, according to the lawsuit, its acquisition allegedly benefitted the Tesla board, Musk, and his brother Kimbal Musk, “at the expense of Tesla and its minority stockholders.”
At the time, Musk also held a 22 percent stake in SolarCity, and was a chairman of the company.
According to the plaintiffs’ lawyer Randall Baron, the damages in the lawsuit add up to be between $2.2 and $2.6 billion. However, if the judge finds Musk liable, Baron says “it will be up to the judge to determine how to calculate those damages.”
At the time of the acquisition, SolarCity reportedly has $3 billion in debt, after continually failing to make a profit.