Judge approves settlement in suit that Tesla’s board overpaid themselves

The judge approved the settlement, which finally ends the case against Tesla by the Detroit Police and Fire Retirement System. Shareholders alleged that Tesla’s board of directors overpaid itself between 2017 and 2020.

Delaware Chancery Court Chancellor Katelyn McCormick approved the settlement of yesterday. Tesla directors will have to return approximately $277 million in cash and $459 million in stock options, and forgo $184 million in stock options for 2021-2023. McCormick also awarded $176 million in fees and costs to the three law firms that brought the case on a contingency basis.

Notable directors named in the suit include Chairman Robin Denholm, James Murdoch (son of Fox News owner Rupert Murdoch) and Larry Ellison (co-founder of Oracle). Council members have not admitted wrongdoing, and the agreement does not specify how much each person must repay, only a collective amount.