Ilan Mask is due in court on July 12 to defend Tesla’s deal to buy SolarCity. SolarCity was owned by Mask relatives and was added to the Tesla subsidiary in 2016. The plaintiffs in the case, who are Tesla shareholders, believe that Mask and Tesla’s board did so to prevent SolarCity from going bankrupt.
Ilan Musk is due to appear in court next Monday to test Tesla’s decision to buy SolarCity against angry shareholders. To defend. The case was filed in court in 2017, and the plaintiffs believed that Mask and other board members, including Kimball Mask, Ilan’s brother, had benefited from the deal in exchange for small shareholder losses.
Musk owned a 22% stake in SolarCity at the time and was a board member of the company. The plaintiffs’ lawyer says the total compensation they are seeking is estimated at $ 2.2 billion to $ 2.6 billion. But if Tesla loses the case, he will probably pay a lower fine, but the final decision will be with the judge.
The case states that SolarCity has always failed to make a profit and has generated a mountain of debt. The company’s assets were losing ground at an uncontrollable rate, and SolarCity owed $ 3 billion at the time.
The first hearing was originally scheduled for March 2020, but was postponed due to the global coronavirus epidemic. All members of Tesla’s board agreed with the plaintiffs in January last year to pay $ 60 million in damages, but Mask did not comply and now has to appear in court alone.
Solarcity was founded in 2006 by Lyndon Rio and Peter Rio and manufactures solar panels. The two brothers left SolarCity in 2017 to work on their new startups.