Investor's Corner
Tesla shareholder’s legal team adjusts demand to $1.44 billion in fees for Musk pay case
The legal team of Tesla shareholder Richard Tornetta, who filed a legal complaint against Elon Musk’s 2018 CEO Performance Award, has adjusted their plaintiff fee request to the Delaware Court. Tornetta’s legal team noted that they could adjust their proposed fee to just $73,948 per hour, which would amount to a cash award of roughly $1.44 billion.
The Tornetta vs. Musk case became a notable issue for the electric vehicle maker back in January when Judge Kathaleen McCormick of the Delaware Court of Chancery rescinded Musk’s 2018 CEO Performance Award. For their work in the case, Tornetta’s legal team argued that they should be granted 29.4 million TSLA shares. Such an amount would be worth over $5 billion, or more than $200,000 per hour.
Tesla has argued against Tornetta’s legal team’s arguments. As noted in a Reuters report, the electric vehicle maker argued that the legal team of the Tesla shareholder — who held nine shares when he filed his complaint against Musk’s 2018 pay package — should be paid just about $13.6 million for their work. Longtime Tesla retail shareholder Amy Steffens has also secured legal counsel to challenge the $200,000 per hour fee request of Tornetta’s attorneys.
In their recent filing, Tornetta’s legal team proposed an alternative way of looking at the fees for their work in the case. While the legal team rejected Tesla’s $13.6 million legal fee argument, and while the attorneys still argued that the court should strongly consider granting them over 29 million TSLA shares as payment, they noted that the Court could go for a cash-based alternative structure instead. Such a system would lower their hourly rate to $73,948, and would result in a payment of around $1.44 billion.
$73,948 per hour is unacceptable and highly inappropriate to request.
The ABA Rules for Professional Conduct, specifically Rule 1.5(a) states: “A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses…”
In short,… https://t.co/kItq68oBAK— Jade (@ImUsuallyRighTT) June 22, 2024
Following are sections of the filing from Tornetta’s lawyers.
“While Plaintiff’s Counsel sincerely believe the award sought is appropriate, earned, and indeed conservative under Delaware law—the Action did, after all, rescind an ‘unfathomable’ $55B compensation package, the largest in history by multiples—Plaintiff’s Counsel acknowledge the requested award, if granted, would be record-setting and the subject of significant commentary. Were the Court concerned by the requested award’s size and desirous of a different approach, there are other alternatives available that address the expressed concerns about “windfalls.”
“Specifically, $35,000/hour cannot be a ‘windfall’ because that hourly rate was awarded by this Court and affirmed by the Supreme Court over a decade ago in Southern Peru. Adjusted to today’s dollars, a $35,000 hourly rate would be over $55,600/hour. It follows, a fortiori, that for a substantial verdict on the order of Southern Peru, an award of at least $55,600/hour is not a ‘windfall.’
“Indeed, even Tesla argues that this Action created compensable value equal to its calculation of the Grant’s $2.3B GDFV. But even using this low-end value estimate, the benefit Plaintiff achieved here was significantly higher than the $1.347B (pre-interest) Southern Peru benefit. Thus, a low-end cash award of roughly $1.0842B could be fashioned based solely on the affirmed, inflation-adjusted Southern Peru numbers.
“But any such award would be unfairly low for two reasons. First, as noted in Plaintiff’s Opening Brief, this Court in Southern Peru—after admonishing plaintiff’s counsel to seek a conservative fee given ‘the reality [that] their own delays affected the remedy awarded’—further reduced that request by one-third as a penalty for counsel taking so long to prosecute the case that rescission was impossible. Second, the ~$51B benefit achieved here is approximately 38x higher than the benefit achieved in Southern Peru.
“Adjusting for the one-third penalty assessed in Southern Peru—which was applied to an already conservative 22.5% request by that plaintiff—brings the inflation-adjusted lodestar to $73,948/hour, which yields a fee of approximately $1.44B. Adjusting further to reflect the much higher result here is a matter of the Court’s discretion Plaintiff’s Counsel would submit that exercising the Court’s discretion to award a cash fee of roughly twice the inflation-adjusted Southern Peru hourly rate after reversing for the discount appropriately reflects the substantially greater benefit achieved here,” Tornetta’s lawyers wrote.
The fling from Tornetta’s lawyers can be viewed below (via Plainsite).
gov.uscourts.delch.2018-0408-KSJM.387.0 by Simon Alvarez on Scribd
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In a new interview on Wednesday, Tesla uber bull Ron Baron said that anyone looking to buy the company’s stock should do so as soon as they can.
Baron, founder and CEO of Baron Capital and one of Tesla’s most persistent institutional bulls, used a CNBC Squawk Box appearance on Wednesday to deliver a familiar message with fresh urgency: In his opinion, Tesla stock is a buy:
“The time to buy the stock is now. FSD is catching on, and it’s going to be bigger and bigger. 55% of new buyers are buying it (Teslas) with FSD. It’s going to be everywhere. It’s safer.”
The Baron Capital frontman’s case is built around Full Self-Driving. Tesla reported 1.48 million active FSD subscriptions in the second quarter, up 56 percent year over year, and company officials have said roughly 55 percent of new North American deliveries left with a subscription enabled.
Baron framed that attach rate as proof the product is moving from enthusiast extra to default expectation, and as a reason software, not just vehicle volume, should drive the next phase of value.
His conviction on Tesla shares is not theoretical, as Baron Capital made its first Tesla investment in 2014, after years of meetings that began around the 2010 IPO roadshow. The firm later built a large SpaceX position starting in 2017.
Ron Baron today in new interview on Tesla:
“The time to buy the stock is now. FSD is catching on, and it’s going to be bigger and bigger. 55% of new buyers are buying it (Teslas) with FSD. It’s going to be everywhere. It’s safer.” pic.twitter.com/Rv5PB0bVZ2
— Sawyer Merritt (@SawyerMerritt) September 16, 2026
Baron said those Musk-led bets have generated about $30 billion of the $71 billion in profits Baron Capital has produced for clients. He put the firm’s current exposure at roughly $25 billion in SpaceX and $5 billion in Tesla. Personally, he described SpaceX as his largest holding, at about $5 billion, with about $1.5 billion in Tesla and additional Tesla exposure through the firm’s funds.
That concentration is also a statement of loyalty. Asked about talk of a SpaceX-Tesla combination, Baron said he had already walked Elon Musk through arguments for and against a deal, then declined to repeat them on air. His public position was simpler: “Whatever you decide is better is what I’m going to support,” he said to Musk.
Baron also said that he picked up the farewell edition of the Model S after Tesla decided to sunset the vehicle earlier this year, calling it his favorite car he’s ever driven.
Elon Musk
Elon Musk gives his most telling Tesla-SpaceX merger conversation yet
Elon Musk hinted a Tesla-SpaceX merger could be coming, and Wall Street is taking notice.
Elon Musk gave his clearest signal yet that Tesla and SpaceX could eventually combine, telling the All-In Summit in Los Angeles that the two companies’ deepening collaboration makes the question worth asking. Sawyer Merritt first surfaced the highlight on X Tuesday.
Asked directly why Tesla and SpaceX remain separate given how closely they already work together, Musk told hosts at the summit: “Great question there. With all this collaboration, on so many levels, who can imagine what action one might take when there’s so much close collaboration in so many areas.” SpaceX President Gwynne Shotwell, who joined Musk on stage, added that SpaceX personnel have already moved into xAI to fill leadership and engineering gaps, saying the businesses are integrating “faster than I thought,” though “not fully integrated yet,”
The comments landed on top of merger speculation that has been building on Wall Street for months. JPMorgan has called a tie-up “strategically coherent on paper,” pointing to overlapping ambitions in AI, robotics, energy, transportation and space. Jefferies went further, estimating Musk could retain roughly 55.3 percent voting control in a deal structured without a premium, a scenario that would still leave room for Tesla shareholders to come out ahead. On Kalshi, traders now put the odds of a merger before 2028 at 66 percent.
Tesla’s stake in SpaceX, still under one percent, traces back to its earlier investment in xAI, which converted to SpaceX equity after SpaceX absorbed the AI company. The two are also jointly building Terafab, a chip facility in Austin meant to serve both Tesla’s AI computing needs and SpaceX’s satellite ambitions. Wedbush analyst Dan Ives has stood by a 2027 merger timeline for months, and Cathie Wood’s ARK Invest recently floated a similar case, an idea Musk pushed back on directly at the time.
Another Tesla SpaceX merger prediction by ARK Invest has Elon Musk talking
The timing adds another layer. Tesla has scheduled an October 1 unveiling for its next generation Roadster at a venue near SpaceX’s McGregor, Texas test site, using the phrase “Go for launch” in its promotional material. Both stocks dipped roughly 2 percent Monday before recovering slightly in premarket trading Tuesday, with SpaceX shares up about 0.4 percent and Tesla essentially flat.
Musk stopped short of confirming anything is in motion. But unlike his past denials of a corporate restructuring, this response didn’t rule one out, and it came with Shotwell sitting next to him describing an integration that’s already underway.
Elon Musk
Tesla Cybercabs narrowly miss deadly Amazon cargo plane crash
An Amazon cargo plane crash near Miami’s airport stopped feet from dozens of Tesla Cybercabs.
An Amazon Prime Air Boeing 767 cargo jet overran the runway at Miami International Airport on Sunday afternoon, killing five people and injuring five more. The jet, operated by North Carolina based carrier 21 Air as Flight 7598, touched down around 2 p.m. after arriving from San Juan, Puerto Rico, then crossed the airport perimeter, plowed across NW 67th Avenue and struck multiple vehicles before catching fire, according to the Associated Press.
Photos and video from the scene show the aircraft’s nose stopped within meters of a fenced staging lot holding dozens of gold painted Tesla Cybercabs, the steering wheel free robotaxi Tesla began putting on public roads in Austin last week. Miami-Dade Fire Rescue has confirmed the plane struck “multiple vehicles” but has not said whether any Cybercabs were among them, and neither Tesla nor airport officials have addressed the fleet directly.
The Cybercabs had not yet entered commercial service in Miami. Tesla’s existing Robotaxi operation there runs on modified Model Y vehicles and has been unsupervised since Ashok Elluswamy confirmed the detail on X in July.
Footage of the plane crash from earlier today | #ONLYinDADE pic.twitter.com/iGoOtnd6cD
— ONLY in DADE (@ONLYinDADE) September 6, 2026
Elon Musk offered the briefest of reactions. Replying to a Zero Hedge post about the Cybercabs sitting so close to the wreckage, he wrote a single word: “Weird.” He has not commented further, and Tesla has not issued a statement.
The timing puts Tesla’s newest vehicle near an unrelated but highly visible tragedy just days after its Austin debut, a launch that had already drawn scrutiny from federal regulators. The National Highway Traffic Safety Administration opened an audit how Tesla certified the Cybercab as compliant with federal vehicle safety standards, a process Teslarati covered after the vehicle’s September 3 launch event. That inquiry concerns the car’s lack of a steering wheel and pedals, not the Miami crash.
Investigators from the FAA and NTSB are focused on the plane, not the parking lot beside it. Flight data reviewed by outlets including Simple Flying show the 767 touched down around 170 knots, well above the 135 to 140 knot range typical for the aircraft, though investigators have not determined a cause. Amazon said it is working with authorities and that its priority is the safety of everyone affected.
Whether any Cybercabs were damaged, and what Tesla plans for the fleet parked near one of the country’s busiest airports, remain open questions.
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