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Musk tells court he dislikes being Tesla CEO as SolarCity trial opens

Stock Markets1 hour ago (Jul 12, 2021 01:56PM ET)

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(C) Reuters. FILE PHOTO: Tesla Inc CEO Elon Musk walks next to a screen showing an image of Tesla Model 3 car during an opening ceremony for Tesla China-made Model Y program in Shanghai, China January 7, 2020. REUTERS/Aly Song/File Photo

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By Tom Hals and Sierra Jackson

WILMINGTON, Del. (Reuters) – Elon Musk insisted in court on Monday he does not control Tesla (NASDAQ:TSLA) Inc and said he did not enjoy being the electric vehicle company’s chief executive as he took the stand to defend the company’s 2016 acquisition of SolarCity.

The lawsuit by union pension funds and asset managers alleges the celebrity CEO strong-armed Tesla’s board into wasting the company’s assets to buy SolarCity, which was running out of cash. Musk at the time owned a 22% stake in both Tesla and SolarCity, which was founded by his cousins.

Musk said in his testimony Monday that he’s tried “very hard not to be the CEO of Tesla, but I have to or frankly Tesla is going to die.”

The shareholders’ lawsuit accuses Musk of dominating deal discussions, pushing Tesla to pay more for SolarCity and misleading shareholders about the deteriorating financial health of the solar panel maker.

Kicking off a two-week trial in Wilmington, Delaware, Musk, wearing a dark suit, white shirt and a slightly askew dark tie, refused to agree he controlled board members and disagreed that recordings of interviews depicted him as a boss with unlimited power.

Shareholder attorney Randall Baron asked if the board vetted his two “master plans” for Tesla or his Technoking title, which he gave himself in March.

“It generated a whole bunch of free press and Tesla doesn’t advertise and it’s helpful to general sales,” he said of the unusual title, calling it a joke. “I think I’m funny.”

Tesla’s master plans outline the company’s long-term goal to create affordable vehicles with sustainable power sources.

Central to the case are claims that Musk was a controlling shareholder of Tesla. If he was, it would impose a tougher legal standard and increase the likelihood the deal was unfair to shareholders.

Shareholders have asked the court to order Musk, one of world’s richest people, to repay to Tesla what it spent on the deal.

Musk often declined to give the simple yes or no responses sought by Baron. Most of the questioning focused on the Tesla board’s control over Musk.

Musk was initially questioned for about an hour by his attorney, Evan Chesler, who asked him to describe his relationship with the board of directors. Musk said: “I’d say good. They work hard and are competent. They provide good advice and are rigorous in acting on behalf of shareholders.”

Legal experts said the judge will be looking for evidence that Musk threatened board members or that directors felt they could not stand up to him. Board members and others involved in the 2016 deal will testify beginning as soon as Tuesday.

Baron warned Musk at the start of questioning that “we plan to spend a lot of time with you. It’s going to be a grind.”

Musk grimaced, poked at the six-inch thick binder exhibit and replied “I can tell by the binder.”

Tesla’s directors settled allegations from the same lawsuit last year for $60 million, paid by insurance, without admitting fault.

Musk tells court he dislikes being Tesla CEO as SolarCity trial opens

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