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Lawyers who voided Elon Musk's pay as excessive want $6B fee

44 points by phreenet 3y ago

sudden_dystopia 3y ago
I despise lawyers.
- bigmattystyles 3y ago
  Until you need one
  - kylecazar 3y ago
    I think there are many people who held no opinions about lawyers UNTIL they needed one :) I personally have had only positive experiences, but I've heard the horror stories. Beyond just the expected divorce stuff. Of course what matters are the circumstances.
  - drdaeman 3y ago
    I’d love to see a legal system that is comprehensible enough for a layman so pro se is the go-to option and the lawyers are for the real tricky cases, or people who can’t or don’t want to even think about it. Not happening, of course. Modern legal systems have incentives to build barriers. (For what it’s worth, I’ve never needed a lawyer and I’ve dealt with immigration in two countries and some basic legal stuff. Wasn’t a rocket science - the worst of it were all the unwritten rules. But of course, that was quite simple and straightforward stuff - surely, there are legal issues that are much more complex.)
    - rhelz 3y ago
      // a legal system that [laymen can understand] // Alas, you wouldn't like a legal system which a layman could understand, any more than you'd like a computer which a layman could understand. We are doing things, as a society and as a species, which take far longer than one individual lifetime to learn, so we divide up the work and specialize.
      - drdaeman 3y ago
        I could be wrong or naive, of course, but... > so we divide up the work and specialize There's an important key difference - no one is forcing anyone to understand how computers work in detail, and the situation where one needs this specialized knowledge is quite uncommon. Thus, this can be left to the specialists. I do believe, though, that everyone should probably know how the computers work at the extremely high level, though. Because virtually everyone deals with computers those days, so this knowledge is nearly essential. And if someone wants to learn more for whatever reason - they should be more than welcome to do so, without any artificial barriers. No one should ever say "computers are really hard, only licensed engineers should be allowed to... (idk what)" In the same way of logic, consider that everyone is a part of a legal and political systems, whenever they want it or not. Which is why I'd like to make those as accessible as reasonably possible, with the basics well comprehensible so you don't normally need a lawyer. I think a better comparison could be with electricians, plumbers or builders. And with those, no one should need a specialist to do basic stuff (like replacing a light bulb or installing a bidet), and no one should be actively discouraged from learning more advanced things. I'm saying this as someone who re-wired a fire hazard of an old house (with copper-aluminium twists from '40s, no grounding, and so on) up to a proper code (checked with a real electrician, of course), installed a water heater after old one had failed, replaced a car radio, etc. - just because I had time and desire to learn and do it myself (also saved some money). At the same time, I've happily went to a mechanic when there was something with the starter and I'm about to call a contractor for a simple leaky faucet, just because I don't have time for this. Computers or anything else - I'm all for all the modern man-designed systems to be understandable and/or serviceable. So anyone with a working brain can do things themselves if they want it and have time for it, and no one is forced to hire anyone unless they prefer it that way (which is totally fine - like you've said, we divide work and specialize, optimizing our resources). Save the obvious exceptions where the risk of harming others is too high - e.g. the building codes are there for a good reason. And I'd say some legal systems look way too unnecessarily complicated (or poorly designed) to me. And popular culture is complicit in re-enforcing this isn't helping - it's reinforcing the current status quo. Which seems to contradict the whole idea of resource optimization.
        3y ago
  - mansion7 3y ago
    Until you need one to defend you from... another lawyer. A pattern emerges
mschuster91 3y ago
IMHO, it's high time to stop paying lawyers, accountants, notary publics (in Germany) and similar professions in percentages. There is no way a bunch of lawyers deserves that kind of payout.
- Ekaros 3y ago
  Set maximum billable rate at minimum wage. That seems only fair solution. It is enough for many workers, should be enough for anyone.
  - rhelz 3y ago
    chuckle why stop there? motherhood seems to be a quite important job. I don't know about you, but my mother didn't even get minimum wage for all her mothering. How much she got is the same number, whether you measure it in dollars, euros, or pounds: 0.00
    - mschuster91 3y ago
      In many European countries, you actually do get government assistance for children [1]. [1] https://de.wikipedia.org/wiki/Kindergeld https://de.wikipedia.org/wiki/Kindergeld
  - jjtheblunt 3y ago
    That makes no sense, as it equally rewards lazy people with abilities too lazy to be applied, and people who took years out of earnings to learn new skills. Of course, the comment might have been obvious trolling.
    - rhelz 3y ago
      Not trolling. What, pray tell, is a fair wage? Who gets to decide? // people who took years out of earnings to learn a new skill // Here in Indiana, you have to have a Master's degree to be a teacher. Average wage is around $50k. Or you could get a B.S. in communications an and make 2-3x that doing P.R. Or you could just drop out of high school to become a "creator" at only fans and make zillions a year taking pictures of your toes. If you want a system which rewards years of learning new skills, this one ain't it.
ejj28 3y ago
Sounds like they need to hire more lawyers to argue that the first set of lawyers' pay is excessive.
- pylua 3y ago
  I could see this as a recursive lawsuit. One set of lawyers negiotates the pay down to the payment down to 3 billion. The next set of lawyers argues two billion is too high and negiotates it down to 1 billion, all the way to zero. It's lawers all the way down!
  - euroderf 3y ago
    Hopefully the series is convergent. Altho I would not bet my life on it.
pylua 3y ago
I am confused. These are the lawyers that sued Tesla and won, not Elon/Telsa's lawyers, and they want that sort of payout due to the cost savings to Tesla? If so, I wonder who funded the original lawsuit -- was that not enough -- or was this the idea all along?
- f38zf5vdt 3y ago
  It's straightforward. The attorneys are arguing that because they have prevented what amounts to the embezzlement of $50b from Tesla and its shareholders, they are entitled to close to 10%. This is similar to SEC whistleblowers. > The Commission is authorized by Congress to provide monetary awards to eligible individuals who come forward with high-quality original information that leads to a Commission enforcement action in which over $1,000,000 in sanctions is ordered. The range for awards is between 10% and 30% of the money collected.
  - pylua 3y ago
    Thanks. That provides much better context.
  - voisin 3y ago
    > prevented what amounts to the embezzlement How does it amount to embezzlement? I understand the SEC reward is for whistleblowing, but how is it whistleblowing if the information want publicly available via filings?
    - f38zf5vdt 3y ago
      Elon packed the board with personal friends who would never in a million years turn down any compensation package he asked for. The extent of their relationship was not disclosed in public filings. It's reasonable for the shareholders to ask if maybe the money could have been better spent on R&D or a cheaper CEO than being shuttled off as personal funds for the CEO. > Typical elements of the crime of embezzlement are the fraudulent conversion of the property of another person by the person who has lawful possession of the property. You can read about the extent of the alleged fraud in the judgment, but it is clear that the board was nothing more than sycophants _not_ acting in the fiduciary interest of the shareholders. https://courts.delaware.gov/Opinions/Download.aspx?id=359340 https://courts.delaware.gov/Opinions/Download.aspx?id=359340 > The Proxy failed to disclose any of the Compensation Committee members’ > actual or potential conflicts with respect to Musk.747 In fact, the Proxy repeatedly > described the members of the Compensation Committee as independent, stating: > “The[] [Grant] discussions first took place among the members of the Compensation > Committee . . . all of whom are independent directors;”748 and “[t]he independent > members of the Board, led by the members of the Compensation Committee, spent > more than six months designing [the Grant].”749 The Proxy’s introductory letter is > “[f]rom the Independent Members of Tesla’s Board of Directors,” and the first four > signatories are Compensation Committee members Gracias, Ehrenpreis, Denholm, > and Buss.750 Notably, Gracias signed as “Lead Independent Director.”751 > The description of the Compensation Committee members as “independent” > was decidedly untrue as to Gracias and proved untrue as to the remaining committee > members.
deleted 3y ago
[deleted]
seydor 3y ago
Welp if he wants revenge he can grant them their billion stock and then start selling the next day. Tesla is a meme, and so are these lawyers
rhelz 3y ago
I don't understand why everybody thinks this fee is outrageous. These lawyers just saved Tesla's shareholders way, way more than that. Pay $6 billion to get $50 billion? I'll do that deal all day long and twice on Sundays.
- seydor 3y ago
  Musk would be paid in stock, so the "shareholders" did not win or lose anything (unless we assume the shareholders are at war with each other). If he turns sour ... i cant imagine the shareholders feeling like they won much. In other news, cheap EVs are entering the market so maybe it's a good opportunity for Elon to escape Tesla before it becomes a legacy brand name that some chinese maker will buy in a few years (like chevrolet or sth).
  - pylua 3y ago
    > did not win or lose anything Is this true? Would there not be dilution?
    - Kluggy 3y ago
      There absolutely will be
      - seydor 3y ago
        How would there be dilution? He got stock options
      - mgiannopoulos 3y ago
        Since the stock went up 10x during the timeframe of the deal, the shareholders benefited a lot.
        Kluggy 3y ago
        Some shareholder benefited a lot. Some bought at the top and have only had negative returns. Some have a net zero cause the bought at this point on the way up. Just because some people have astronomical returns doesn't mean everyone received the same.
deleted 3y ago
[deleted]

44 points by phreenet 3y ago

sudden_dystopia 3y ago

I despise lawyers.

bigmattystyles 3y ago
Until you need one
- kylecazar 3y ago
  I think there are many people who held no opinions about lawyers UNTIL they needed one :) I personally have had only positive experiences, but I've heard the horror stories. Beyond just the expected divorce stuff. Of course what matters are the circumstances.
- drdaeman 3y ago
  I’d love to see a legal system that is comprehensible enough for a layman so pro se is the go-to option and the lawyers are for the real tricky cases, or people who can’t or don’t want to even think about it. Not happening, of course. Modern legal systems have incentives to build barriers. (For what it’s worth, I’ve never needed a lawyer and I’ve dealt with immigration in two countries and some basic legal stuff. Wasn’t a rocket science - the worst of it were all the unwritten rules. But of course, that was quite simple and straightforward stuff - surely, there are legal issues that are much more complex.)
  - rhelz 3y ago
    // a legal system that [laymen can understand] // Alas, you wouldn't like a legal system which a layman could understand, any more than you'd like a computer which a layman could understand. We are doing things, as a society and as a species, which take far longer than one individual lifetime to learn, so we divide up the work and specialize.
    - drdaeman 3y ago
      I could be wrong or naive, of course, but... > so we divide up the work and specialize There's an important key difference - no one is forcing anyone to understand how computers work in detail, and the situation where one needs this specialized knowledge is quite uncommon. Thus, this can be left to the specialists. I do believe, though, that everyone should probably know how the computers work at the extremely high level, though. Because virtually everyone deals with computers those days, so this knowledge is nearly essential. And if someone wants to learn more for whatever reason - they should be more than welcome to do so, without any artificial barriers. No one should ever say "computers are really hard, only licensed engineers should be allowed to... (idk what)" In the same way of logic, consider that everyone is a part of a legal and political systems, whenever they want it or not. Which is why I'd like to make those as accessible as reasonably possible, with the basics well comprehensible so you don't normally need a lawyer. I think a better comparison could be with electricians, plumbers or builders. And with those, no one should need a specialist to do basic stuff (like replacing a light bulb or installing a bidet), and no one should be actively discouraged from learning more advanced things. I'm saying this as someone who re-wired a fire hazard of an old house (with copper-aluminium twists from '40s, no grounding, and so on) up to a proper code (checked with a real electrician, of course), installed a water heater after old one had failed, replaced a car radio, etc. - just because I had time and desire to learn and do it myself (also saved some money). At the same time, I've happily went to a mechanic when there was something with the starter and I'm about to call a contractor for a simple leaky faucet, just because I don't have time for this. Computers or anything else - I'm all for all the modern man-designed systems to be understandable and/or serviceable. So anyone with a working brain can do things themselves if they want it and have time for it, and no one is forced to hire anyone unless they prefer it that way (which is totally fine - like you've said, we divide work and specialize, optimizing our resources). Save the obvious exceptions where the risk of harming others is too high - e.g. the building codes are there for a good reason. And I'd say some legal systems look way too unnecessarily complicated (or poorly designed) to me. And popular culture is complicit in re-enforcing this isn't helping - it's reinforcing the current status quo. Which seems to contradict the whole idea of resource optimization.
      - 3y ago
- mansion7 3y ago
  Until you need one to defend you from... another lawyer. A pattern emerges

mschuster91 3y ago

IMHO, it's high time to stop paying lawyers, accountants, notary publics (in Germany) and similar professions in percentages. There is no way a bunch of lawyers deserves that kind of payout.

Ekaros 3y ago
Set maximum billable rate at minimum wage. That seems only fair solution. It is enough for many workers, should be enough for anyone.
- rhelz 3y ago
  chuckle why stop there? motherhood seems to be a quite important job. I don't know about you, but my mother didn't even get minimum wage for all her mothering. How much she got is the same number, whether you measure it in dollars, euros, or pounds: 0.00
  - mschuster91 3y ago
    In many European countries, you actually do get government assistance for children [1]. [1] https://de.wikipedia.org/wiki/Kindergeld https://de.wikipedia.org/wiki/Kindergeld
- jjtheblunt 3y ago
  That makes no sense, as it equally rewards lazy people with abilities too lazy to be applied, and people who took years out of earnings to learn new skills. Of course, the comment might have been obvious trolling.
  - rhelz 3y ago
    Not trolling. What, pray tell, is a fair wage? Who gets to decide? // people who took years out of earnings to learn a new skill // Here in Indiana, you have to have a Master's degree to be a teacher. Average wage is around $50k. Or you could get a B.S. in communications an and make 2-3x that doing P.R. Or you could just drop out of high school to become a "creator" at only fans and make zillions a year taking pictures of your toes. If you want a system which rewards years of learning new skills, this one ain't it.

ejj28 3y ago

Sounds like they need to hire more lawyers to argue that the first set of lawyers' pay is excessive.

pylua 3y ago
I could see this as a recursive lawsuit. One set of lawyers negiotates the pay down to the payment down to 3 billion. The next set of lawyers argues two billion is too high and negiotates it down to 1 billion, all the way to zero. It's lawers all the way down!
- euroderf 3y ago
  Hopefully the series is convergent. Altho I would not bet my life on it.

pylua 3y ago

I am confused. These are the lawyers that sued Tesla and won, not Elon/Telsa's lawyers, and they want that sort of payout due to the cost savings to Tesla? If so, I wonder who funded the original lawsuit -- was that not enough -- or was this the idea all along?

f38zf5vdt 3y ago
It's straightforward. The attorneys are arguing that because they have prevented what amounts to the embezzlement of $50b from Tesla and its shareholders, they are entitled to close to 10%. This is similar to SEC whistleblowers. > The Commission is authorized by Congress to provide monetary awards to eligible individuals who come forward with high-quality original information that leads to a Commission enforcement action in which over $1,000,000 in sanctions is ordered. The range for awards is between 10% and 30% of the money collected.
- pylua 3y ago
  Thanks. That provides much better context.
- voisin 3y ago
  > prevented what amounts to the embezzlement How does it amount to embezzlement? I understand the SEC reward is for whistleblowing, but how is it whistleblowing if the information want publicly available via filings?
  - f38zf5vdt 3y ago
    Elon packed the board with personal friends who would never in a million years turn down any compensation package he asked for. The extent of their relationship was not disclosed in public filings. It's reasonable for the shareholders to ask if maybe the money could have been better spent on R&D or a cheaper CEO than being shuttled off as personal funds for the CEO. > Typical elements of the crime of embezzlement are the fraudulent conversion of the property of another person by the person who has lawful possession of the property. You can read about the extent of the alleged fraud in the judgment, but it is clear that the board was nothing more than sycophants _not_ acting in the fiduciary interest of the shareholders. https://courts.delaware.gov/Opinions/Download.aspx?id=359340 https://courts.delaware.gov/Opinions/Download.aspx?id=359340 > The Proxy failed to disclose any of the Compensation Committee members’ > actual or potential conflicts with respect to Musk.747 In fact, the Proxy repeatedly > described the members of the Compensation Committee as independent, stating: > “The[] [Grant] discussions first took place among the members of the Compensation > Committee . . . all of whom are independent directors;”748 and “[t]he independent > members of the Board, led by the members of the Compensation Committee, spent > more than six months designing [the Grant].”749 The Proxy’s introductory letter is > “[f]rom the Independent Members of Tesla’s Board of Directors,” and the first four > signatories are Compensation Committee members Gracias, Ehrenpreis, Denholm, > and Buss.750 Notably, Gracias signed as “Lead Independent Director.”751 > The description of the Compensation Committee members as “independent” > was decidedly untrue as to Gracias and proved untrue as to the remaining committee > members.

deleted 3y ago

[deleted]

seydor 3y ago

Welp if he wants revenge he can grant them their billion stock and then start selling the next day. Tesla is a meme, and so are these lawyers

rhelz 3y ago

I don't understand why everybody thinks this fee is outrageous. These lawyers just saved Tesla's shareholders way, way more than that. Pay $6 billion to get $50 billion? I'll do that deal all day long and twice on Sundays.

seydor 3y ago
Musk would be paid in stock, so the "shareholders" did not win or lose anything (unless we assume the shareholders are at war with each other). If he turns sour ... i cant imagine the shareholders feeling like they won much. In other news, cheap EVs are entering the market so maybe it's a good opportunity for Elon to escape Tesla before it becomes a legacy brand name that some chinese maker will buy in a few years (like chevrolet or sth).
- pylua 3y ago
  > did not win or lose anything Is this true? Would there not be dilution?
  - Kluggy 3y ago
    There absolutely will be
    - seydor 3y ago
      How would there be dilution? He got stock options
    - mgiannopoulos 3y ago
      Since the stock went up 10x during the timeframe of the deal, the shareholders benefited a lot.
      - Kluggy 3y ago
        Some shareholder benefited a lot. Some bought at the top and have only had negative returns. Some have a net zero cause the bought at this point on the way up. Just because some people have astronomical returns doesn't mean everyone received the same.

deleted 3y ago

[deleted]