“I had faith,” Musk said, “in the future of SolarCity.”
Baron tried to pin down whether Musk
had recused himself from Tesla-SolarCity
negotiations to avoid a conflict of interest.
“I had no material role,” Musk said.
“What’s is a ‘material role?’ ” Baron fired back.
”That sounds like a wiggle word to me.”
“You’re the expert in wiggle words,”
Musk countered.
The trial marks the culmination of seven
shareholder lawsuits, consolidated into one,
that alleged that Tesla directors breached their
fiduciary duties in bowing to Musk’s wishes and
agreeing to buy SolarCity. Last August, a judge
approved a $60 million settlement that resolved
claims made against all the directors on Tesla’s
board except Musk without any admission of fault.
That left Musk, who refused to settle, as the
sole remaining defendant. The trial had been
scheduled for March of last year but was
postponed because of the viral pandemic.
Daniel Ives, an analyst at Wedbush Securities,
has called the acquisition a “clear black eye” for
Musk and Tesla, in large part because SolarCity
has failed to turn a profit.
“It basically was putting good money after bad,”
Ives said. “For all the successes and all of the
unimaginable heights Musk has achieved, this is
one of the lowlights.”
Even if the trial ends with Musk having to pay
personally for the whole SolarCity deal, $2.5 billion
won’t much hurt the world’s third-wealthiest
person. Forbes magazine has estimated that
Musk is worth roughly $163 billion.