Investigation
BioXcel Therapeutics, Inc. (BTAI)
Confidential investigation: officers & directors’ potential breach of fiduciary duties to investors.
Menu
Investigation
06/17/2020
Initial Lawsuit
06/17/2020
Lawsuit Progression
Settlement
07/14/2023
“Derivatively on behalf of Tesla, Inc. against certain members of the company’s current and former board of directors, namely: Brad Buss, Robyn M. Denholm, Ira Ehrenpreis, Lawrence J. Ellison, Antonio J. Gracias, Stephen t. Jurvetson, Kimbal Musk, James Murdoch, Linda Johnson Rice, Kathleen Wilson-Thompson, and Hiromichi Mizuno and fellow director and
Tesla’s controlling stockholder, Elon Musk.”
According to the complaint, Plaintiff The Police and Fire Retirement System of the City of Detroit, a Tesla, Inc. (TSLA shareholder) brought this action for breach of fiduciary duty and unjust enrichment to put an end to the “looting” of Telsa directors self-compensation.
The complaint alleges that the “Director Defendants have used their positions on the Board to enrich themselves at the Company’s expense” and that “Demonstrably unmoored from independent stockholder checks on their self-compensation, they have granted themselves millions in excessive compensation and are poised to continue this unrelenting avarice into the indefinite future.”
According to the complaint, “in 2017, four directors received compensation with a grant date fair value ranging from $1,933,914 to $4,921,810“, but “saved their most audacious behavior for 2018” with “compensation worth an average grant date value of $8,706,126.” The complaint explains that “that year, Tesla’s Board Chair was the second highest Board chair in the United States.” In 2019, the Board members who did not step down “received compensation with a grant date fair value of, on average, $2,161,063 per director.”
In the complaint, Plaintiff explains that it did not make a demand on Tesla’s Board because “disabling conflicts of interest and self-interest render each Defendant incapable of considering a litigation demand” and that absent recourse to the Court, “Plaintiff has no way to compel the Director Defendants to return the excessive compensation they paid themselves or stop them from overcompensating themselves in the future.”
Confidential investigation: officers & directors’ potential breach of fiduciary duties to investors.