News
Tesla investor’s legal team urges DE court to respect Musk pay ratification vote
Tesla shareholders ratified Elon Musk’s 2018 CEO Performance Award at the 2024 Cyber Roundup, but the fight about the matter in Delaware Court is not over just yet. This was highlighted in a joinder filed by the legal team of a TSLA investor who decided to challenge the astronomical fee request of the lawyers of shareholder Richard Tornetta, who filed a legal complaint about Musk’s 2018 pay package at a time when he held just nine shares of the EV maker.
Tornetta’s legal team has argued that they deserve to be paid over 29 million shares of TSLA for their services in the case, which translated to over $5 billion at the time or over $200,000 per hour. Tesla shareholder Amy Steffens, a longtime investor of Tesla with over 19,000 shares, secured her own legal team to challenge the fee request of Tornetta’s lawyers. Following the decision of Tesla investors to ratify Musk’s pay package at the 2024 Cyber Roundup, Tornetta’s legal team argued that the ratification of the CEO’s pay package was invalid since investors were still “coerced” and “uninformed.” The lawyers also described the events that transpired leading up to the ratification of Musk’s pay package as a “clown show.”
Steffens’ legal team has now submitted a joinder for the case, which will hopefully be heard later this week when the court is expected to hold a hearing for the motion to reconsider the Delaware Judge’s preliminary ruling in the case. The joinder, parts of which were shared on X by Tesla investor Alexandra Merz, argued that the ratification of Musk’s pay package by TSLA shareholders showed that Tornetta’s complaint against the CEO Performance Award “provided no tangible economic benefit to Tesla or its stockholders.” Steffens’ legal team also highlighted that contrary to the claims of Tornetta’s lawyers, the shareholder vote on Musk’s pay plan is likely among the most informed stockholder votes in Delaware history.
2/ pic.twitter.com/yR15N66cbM— Ale?andra Merz ?? (@TeslaBoomerMama) July 30, 2024
“The Ratification Vote was fully informed indeed, it is likely among the most informed votes in Delaware corporate history. The extensive proxy filings included this Court’s rescission opinion, so Tesla’s stockholders were well aware of the issues identified by this Court prior to their ratification vote. The ratification issue was robustly debated online, on television, and in newspapers. Opponents— including Mr. Tornetta’s experts in this litigation made their voices heard.’ When the votes came in, Mr. Tornetta lost decisively: 72% of disinterested voting shares favored ratification,” the lawyers wrote.
4/ pic.twitter.com/xc0k1Zsq9A— Ale?andra Merz ?? (@TeslaBoomerMama) July 30, 2024
Steffens’ legal team also addressed the “clown show” comment from Tornetta’s attorneys. “Mr. Tornetta’s counsel disparages this exercise of stockholder democracy as a ‘clown show.’ It is anything but. Ms. Steffens and Tesla’s other stockholders had all the relevant facts before them, including this Court’s decision, and determined that the 2018 Grant benefited them more than rescission. When stockholders freely petition their elected board for a vote, and then overwhelmingly affirm a board’s decision by voting to uphold it, further litigation by a derivative plaintiff attacking that democratically determined result is neither necessary nor appropriate,” Steffens’ legal team noted.
The longtime Tesla investors’ legal team urged the court to respect TSLA stockholders’ democracy as well. “Even beyond Due Process concerns, respect for stockholder democracy commends limiting Plaintiff’s continuing role in light of the Ratification Vote. Here, the question goes beyond Mr. Tornetta’s adequacy to the source of his authority. When Mr. Tornetta steps into the shoes of Tesla as a derivative plaintiff, he does so without democratic legitimacy. Tesla’s stockholders can vote out their directors, but they lack any democratic means to revoke Mr. Tornetta’s authority as a plaintiff.
??— Elon Musk (@elonmusk) July 30, 2024
“Ms. Steffens respectfully suggests that in this specific context-where a supermajority of fully-informed, uncoerced stockholders unambiguously repudiates the relief obtained by a derivative plaintiff-the Court should treat this as a vote of no confidence and withdraw Mr. Tornetta’s authority to act on behalf of the Company. At the very least, where a plaintiff has shown himself willing to pay his counsel hundreds of thousands of dollars per hour to engage in legal work that conflicts directly with the wishes of the vast majority of stockholders, those stockholders should have some means (through the ballot box or the courtroom) to eliminate that plaintiff’s authority to continue to engage in such damaging conduct while purporting to act on their behalf,” the longtime TSLA shareholder’s legal team wrote.
-
Tesla CEO Elon Musk seems to have appreciated the efforts of the TSLA stockholder’s legal team. Responding to a post about the matter on social media platform X, Musk responded to the shareholder’s efforts with a couple of “lit” emojis.
Don’t hesitate to contact us with news tips. Just send a message to simon@teslarati.com to give us a heads up.
-
Elon Musk has declared that SpaceX has effectively solved one of Starship’s most persistent engineering challenges: the reliability of its heat shield tiles.
During the company’s first-ever Earnings Call, the SpaceX CEO stated:
“I don’t want to jinx it or anything, but I think I would call the heat shield problem solved at this point. All indications from data and visual inspection is we have solved it. That doesn’t mean we won’t make improvements, but we do not see any technical obstacles to achieving rapid reusability at this point.”
Starship’s heat shield consists of roughly 18,000 hexagonal ceramic tiles covering the windward side of the upper stage. These tiles form the thermal protection system that shields the vehicle’s stainless-steel structure from the extreme heat of atmospheric reentry.
Elon says he believes the heat shield problem with Starship is currently solved.
He called it “arguably the single biggest problem” pic.twitter.com/eEE9vM5zlz
— TESLARATI (@Teslarati) August 4, 2026
During descent, atmospheric friction generates temperatures exceeding several thousand degrees Celsius and creates plasma flows capable of melting unprotected metal. The tiles absorb, radiate, and insulate against this energy, allowing the vehicle to survive and potentially fly again. Without a durable heat shield, full and rapid reusability, the cornerstone of Starship’s design for frequent launches, satellite deployments, and deep-space missions, would remain impossible.
The tiles have long been a source of difficulty. On earlier test flights, a significant number of tiles detached during ascent due to vibration, aerodynamic loads, and imperfect attachment methods using pins and adhesives. Gaps between tiles allowed hot plasma to infiltrate, causing secondary damage and hot spots on the underlying structure.
These issues echoed challenges faced by NASA’s Space Shuttle, whose ceramic tiles required extensive, labor-intensive inspections and replacements between missions, preventing rapid turnaround. SpaceX has iteratively improved materials, standardized tile shapes, refined attachment techniques, added secondary ablative layers, and tested sealing methods such as “crunch wrap” felt to close gaps.
Progress was visible across Flights 10–12, with steadily better tile retention, yet questions remained about whether the system could support the minimal-refurbishment goal of rapid reuse.
Flight 13 on July 24 provided the decisive evidence. Ship 40 flew a deliberately more demanding profile with higher dynamic pressure to stress the heat shield beyond typical operational loads. It successfully deployed 20 operational Starlink V3 satellites, the first such payload on a Starship mission, performed an in-space Raptor engine relight, and executed a controlled reentry.
Elon Musk sheds two new bits of detail on Starship after 13th test launch
Cameras on six of the satellites and onboard sensors captured extensive imagery and data of the shield throughout the flight. The ship then achieved its softest splashdown to date in the Indian Ocean, remaining intact and floating rather than breaking apart or exploding as on prior missions. This allowed drone inspections and continuous telemetry of the heat shield in near-real time.
Post-flight analysis showed the majority of tiles remaining attached with only minor damage and limited plasma streaking at seams. Musk noted that the mission delivered “all the heat shield data we needed and then some.” Combined with visual inspections, these results underpinned his subsequent assessment that the core technical barriers to rapid reusability have been cleared. While refinements will continue, Flight 13 marked a pivotal step toward Starship’s operational future.
SpaceX COO Gwynne Shotwell outlined ambitious plans for Starlink Mobile during the company’s August 4 Earnings call, signaling a direct challenge to U.S. wireless giants like AT&T, T-Mobile, and Verizon.
Shotwell noted that the three companies generate roughly $600 billion in combined annual revenue. “I anticipate us to be able to acquire quite a few of their customers because I think our service will be better,” she said. “We will eliminate dead zones leveraging the satellites in orbit. It will be better during any natural disaster… I’m quite excited about Starlink Mobile.”
SpaceX President & COO Gwynne Shotwell on @Starlink Mobile and its impact on Verizon, AT&T and T-Mobile:
“Roughly, between them, $600 billion a year. I anticipate us to be able to acquire quite a few of their customers. Our service will be better. We will eliminate dead zones… pic.twitter.com/UYZUkrGc0L
— Sawyer Merritt (@SawyerMerritt) August 4, 2026
SpaceX intends to combine its satellite constellation with terrestrial infrastructure. The company has acquired about 65 MHz of spectrum from EchoStar and plans to deploy next-generation Starlink Mobile satellites in 2027, with upgraded service targeted for the end of that year.
Shotwell described the enhanced network, leveraging more satellites and spectrum, as potentially “100 times better” than the current direct-to-cell offering, which already supports basic texting and app-based voice/video in coverage gaps through partnerships. She also indicated plans for low-cost cellular base stations that could integrate with existing Starlink dishes, creating a hybrid system for broader capacity in urban, suburban, and rural areas.
For the general public, Starlink Mobile promises significant advantages. Satellite connectivity can fill gaps where traditional cell towers fail, delivering service in remote locations, mountains, or during outages caused by storms, wildfires, or infrastructure damage—conditions in which ground networks often collapse.
Users could enjoy more consistent coverage without relying solely on dense tower builds, potentially at competitive prices as SpaceX scales. The hybrid approach aims to support full mobile services, including higher-speed data, while working with unmodified smartphones over time.
These developments revive long-standing but unfounded rumors of a Musk-developed “Tesla phone.” Speculative claims of a “Pi Phone” or similar device with built-in Starlink connectivity have circulated for years on social media, often featuring fabricated images and details. Elon Musk has repeatedly denied any such plans, stating Tesla has no intention of entering the smartphone market unless forced by extreme circumstances with app stores.
No official product, filings, or development announcements have ever materialized; the rumors remain hoaxes.
The announcement quickly pressured telecom stocks. Shares of AT&T, Verizon, and T-Mobile fell between roughly 2 and 4 percent in after-hours and premarket trading as investors weighed the competitive threat from a hybrid satellite-terrestrial network.
While execution challenges remain—spectrum deployment, infrastructure rollout, and regulatory hurdles—Shotwell’s remarks mark SpaceX’s clearest signal yet of entering the consumer mobile market as a full competitor.
Venture capitalist Chamath Palihapitiya has cautioned investors shorting SpaceX shares, drawing a direct parallel to the intense short-selling pressure Tesla faced in its early public years.
Responding to reports of elevated short interest in the newly public rocket, satellite, and AI company, Palihapitiya noted that similar dynamics played out with Tesla, where aggressive short sellers ultimately “went broke.”
SpaceX (NASDAQ: SPCX) went public on June 12, 2026, in the largest IPO on record, pricing at $135 per share. Shares quickly surged to an all-time high of $225.64 just days later, briefly implying a valuation exceeding $2 trillion. The stock has since retreated sharply amid valuation concerns, lockup expiration fears, and broader market dynamics.
By early August, it traded near $108–$125, representing a roughly 50 percent decline from the peak and bringing the market capitalization closer to the $1.5–1.7 trillion range. On August 4, shares closed up more than 9 percent at $125.33 ahead of earnings before facing pressure in after-hours and premarket trading.
Short interest has climbed dramatically. According to S3 Partners data widely cited in market reports, short positions reached approximately 219.3 million shares by late July, about 34 percent of the limited public float of roughly 640 million shares, and represented a notional value of around $24.6 billion.
Utilization of shares available to borrow hit 95 percent, with borrow fees rising. This level of shorting exceeded the dollar value of short bets against Tesla at the time and built rapidly ahead of two catalysts: the company’s first post-IPO earnings and an August 6 lockup expiration that could free up to 911.5 million additional shares.
CEO Elon Musk has issued warnings of his own. In mid-July, as short interest approached one-third of the float, he posted that “the survival probability of firms who maintain a significant short position in SpaceX over time is very low,” reiterating his view that the company could ultimately be worth more than Earth if it achieves its goals.
On August 4, just before earnings, Musk responded to the latest short-interest data by saying, “I try to warn them, but they just double down.”
SpaceX delivered its first quarterly results as a public company after the close on August 4. Second-quarter revenue rose 92 percent year-over-year to $7.8 billion, beating consensus estimates near $6.8–6.9 billion.
The net loss narrowed to $541 million, or 9 cents per share, better than the roughly 23–24 cent loss expected. Starlink/connectivity contributed about $4.3 billion (up 66 percent), while the AI business generated $2.6 billion (up roughly 250 percent). Capital expenditures were heavy at $18.4 billion, largely tied to AI infrastructure. Management projected a $100 billion annualized revenue run rate by year-end 2026 and outlined a path toward $1 trillion in annual revenue by 2030.
The combination of Chamath’s historical reminder, Musk’s repeated alerts, and the company’s ambitious growth targets underscores the high-stakes debate surrounding SPCX. Short sellers are positioned for near-term supply pressure from the lockup, while long-term bulls point to Starlink scale, Starship progress, and AI compute expansion as reasons the bears may ultimately face the same fate as many early Tesla skeptics.
SpaceX has solved Starship’s biggest challenge, Elon Musk says
SpaceX is coming for wireless giants with Starlink Mobile
