SolarCity: new big success for Elon Musk and Tesla

The case had been on trial since last July. It found its outcome on Wednesday April 27: the Court of Delaware, the American state where SolarCity, a manufacturer of solar panels, is legally based, judged Elon Musk for the acquisition of the company by Tesla. Judge rules in favor of new Twitter owner, reports CNBC in an article on Wednesday, April 27. In fact, the billionaire was sued by investors who believed that he had failed in his duties when he decided that Tesla would buy SolarCity, in 2016, for 2.6 billion dollars. The members of Tesla’s board of directors, also sued, had chosen to avoid the trial and settle the case in 2020 by paying $ 60 million, without admitting guilt.

Elon Musk did not wish to take part in this agreement at the time. Investors who filed suit against him blamed him for not serving their best interests and wasting Tesla’s assets when it bought SolarCity in 2016, because the company was then far from profitable and heavily indebted. It was also going so badly that Tesla’s takeover of the company would amount to a bailout, argued the pension funds behind the complaint. At the time, Musk served on the boards of both Tesla and SolarCity, a company founded by his cousins, Peter and Lyndon Rive, in 2006.

The whole question was therefore whether Musk had exerted pressure on the board of directors of Tesla so that the transaction was carried out, which Musk fiercely denied, bring our American colleagues. The billionaire also defended himself by explaining that the merger allowed Tesla to combine its battery business with the solar photovoltaic installations of Solar City. The judge considered for his part that “Tesla’s board of directors had examined the acquisition in depth, and Elon Musk had not obstructed this process”. If he had lost, Musk could have had to pay more than $2 billion. The case could be appealed to the Delaware Supreme Court.

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