On Monday morning, the multi-day trial over billionaire Elon Musk’s Tesla remuneration package case began at Delaware’s Court of Chancery. The first day of the trial is taking place while the Tesla CEO is actively overhauling Twitter following his $44 billion acquisition of the social media business in late October. The compensation lawsuit will be heard by Chancellor Kathaleen McCormick, the same jurist who presided over the contentious court battle between Musk and Twitter.
Richard Tornetta, a Tesla shareholder, first launched the lawsuit several years ago with the intention of having the 10-year compensation deal for Musk that year declared unconstitutional and revoked. Tesla is only cited as a notional defendant in the action, with Musk and six other people named as defendants.
According to a proxy statement, as part of his remuneration package, the business granted him stock options with a 10-year grant that will vest over 12 installments if the company reaches certain operational and market capitalization benchmarks. The CEO receives options worth roughly 1% of Tesla’s equity for each tranche.
When contacted for comment, Greg Varallo, a lawyer for Tornetta, referred FOX Business to the group’s pretrial brief. Regarding the lawsuit, FOX Business also contacted Musk’s attorney, but as of the time of publication, no comment had been received.
Tornetta’s attorneys said Musk “conceived of and dictated [the] key features” of his remuneration package, which they called the “biggest compensation grant in human history” and unreasonable, in the plaintiff’s pretrial brief, which CNBC posted online. They said Musk worked “part-time” as an executive.
They said that given Musk’s shareholding in the electric vehicle maker and his current position at Tesla, the remuneration package was “unnecessary to incentivise” him. According to the lawyers, there were no clauses “restricting or limiting Musk’s allocation of time or attention to non-Tesla endeavors” or “requiring him to dedicate time or attention” to Tesla.
The Boring Company, Open AI, SpaceX, and Neuralink were mentioned in the plaintiff’s pre-trial brief. Musk co-founded the other three companies and is the CEO of SpaceX. However, in the pretrial brief submitted on behalf of Musk and the other defendants, their lawyers disputed the idea that it was not essential, arguing that at the time of the pay package, “the extent of Musk’s engagement in Tesla and the degree to which he would focus on Tesla was undetermined.” According to Musk’s attorneys, the board “fairly judged an audacious strategy” was required and stockholders have benefited from it, according to the brief that PlainSite posted online.
According to the defendants’ brief, the lawyers argued it did not “make sense to compel” the CEO to devote a specified amount of time to Tesla because the expansion required for him to be compensated “could not be completed without significant time and attention.” They said that because Musk “is not the normal CEO,” the proposal was “not a standard pay package meant to recompense the regular executive for overseeing the day-to-day operations of a mature corporation.”
According to the brief, Tornetta’s team also asserted that several board members approved the package despite purportedly missing “standard benchmarking” because they had personal or professional conflicts of interest with Musk. Musk’s attorneys contended that board members did not lack independence in the defendants’ pretrial filing and that Musk was only involved “as the counterparty,” not a controlling shareholder.
The plaintiff’s counsel claimed that some performance goals in the incentive plan, which may be worth up to $50 billion, were already incorporated in Tesla’s financial estimate and “deemed probable of achievement.” Tornetta’s team further claimed that it was “secured with a substantially deceptive and omissive proxy statement” through a subsequent shareholder vote.
On the other side, Musk’s legal team asserted that it accurately disclosed the package’s composition and objectives. They said that at the time of the pay package, Tesla’s “success was far from assured” and that its internal projections had “stretch aims” that were “extremely difficult yet attainable.”
According to reports, during the trial on the Tesla compensation package, Musk and other witnesses will testify.
Read More Financial News Here
Meta Is Fined $275 Million By The Irish Data Privacy Authorities
In a data breach that occurred in 2019, Meta was issued a fine of approximately $275 million by Ireland’s data privacy commission for its failure to prevent hackers from stealing the personal information of more than 500 million Facebook users.
The announcement made on Monday marked the fourth time in about a year that Facebook (FBparent )’s corporation had been punished by the Irish Data Protection Commission. The Irish Data Protection Commission is the major privacy regulator monitoring Meta’s operations in Europe. According to the commission’s statement, the decision to issue the fine was reached on Friday of last week.
Meta has been hit with fines totaling 912 million euros by the Data Protection Commission of Ireland (DPC) since the fall of 2021. The DPC is pursuing the social media giant and its other subsidiaries, Instagram and WhatsApp, for alleged violations of the General Data Protection Regulation, which is Europe’s signature data privacy law (GDPR).
In the early fall of this year, Meta was handed the second-largest GDPR fine in history, which was for the way in which Instagram handled the data of children. The fine was 405 million euros. Additional enforcement procedures, which took place in March 2022 and September 2021, respectively, resulted in the imposition of fines totaling 17 million and 225 million euros.
A representative for Meta issued a statement on Monday stating that the company was “seriously” analyzing the decision made by the DPC and that it had cooperated fully with the investigation being conducted by the agency. The investigation was kicked out in April of last year after it was reported by Business Insider that the personal information of more than half a billion Facebook users had been published on a hacker website. At the time, Facebook stated that hostile actors had used its contact importer tool in order to match known phone numbers to the accounts of Facebook users before extracting more information from their profiles. According to a statement released by Meta on Monday, “Protecting the privacy and security of people’s data is crucial to how our business works.” [Citation needed] “During the time in question, we implemented a number of changes to our systems, one of which was the removal of the capability to scrape our features in this manner by using phone numbers. The scraping of data without authorization is against both our policy and our terms of service, and we will continue to collaborate with our competitors to find a solution to this industry problem.
This judgment was made by the Irish Data Protection Commissioner in the midst of widespread criticism from privacy activists who claim that regulators have proceeded slowly and tentatively to enforce GDPR, which became law in 2018.
Privacy regulators in Luxembourg issued a punishment of 746 million euros to e-commerce giant Amazon (AMZN) in accordance with the General Data Protection Regulation (GDPR) last year. They did so on the grounds that the manner in which Amazon processes personal data is in violation of the law. Amazon (AMZN) is attempting to get the penalty overturned.
Musk Alleges Apple “Threatening To Withhold” Twitter From Its App Store
Elon Musk said that Apple has “threatened” to remove Twitter from its iOS app store, which might devastate the $44 billion firm he acquired.
Musk tweeted Monday that Apple (AAPL) and its CEO had threatened to remove Twitter from its App Store without explaining why.
Musk tweeted that Apple had basically discontinued Twitter advertising. “Do they detest free speech in America?” he asked, referring to his repeated calls for platform free speech. “What’s up, Tim Cook?” Musk tweeted again. He also blasted Apple’s scale, “restriction,” and 30% transaction fee for large app creators in its app store.
Musk’s tweetstorm emphasizes his tense relationship with Apple, which along with Google controls mobile app distribution. Before taking over Twitter, the Tesla CEO stated he explored selling the firm to Apple, but Cook refused to meet with him. Twitter, which has lost advertisers since Musk’s takeover and struggled to grow its subscription business, would suffer if it were removed from Apple’s or Google’s app stores.
Musk’s tweets were unanswered by Apple. The business has already indicated it’s willing to delete apps from its app store over worries about their ability to filter dangerous content or if they attempt to evade the cut Apple takes from in-app sales and subscriptions. After the US Capitol attack, Apple withdrew Parler, a conservative app, from its app store over concerns about its capacity to recognize and filter hate speech and incitement. After improving its content moderation, Apple reinstated Parler three months later.
Apple’s app store review criteria require apps to prevent “material that is unpleasant, insensitive, distressing, intended to disgust, in extraordinarily poor taste, or just plain creepy” such hate speech, pornography, and terrorism. The guidelines declare that the App Store is not the place for apps that shock and offend.
After extensive layoffs and large employee departures, civil society groups, researchers, and industry watchers have voiced worries about Twitter’s ability to monitor dangerous content and keep the network safe. Musk also wants to promote “free expression” on Twitter by restoring banned or suspended accounts. Musk has tweeted a conspiracy theory and other controversial messages since taking over Twitter.
Since becoming CEO, Musk, a prolific and aggressive tweeter, has continued. He claims engagement has compensated for revenue losses. The objective appears to be persistently targeting enemies of his or “free speech.” Cook was questioned in an interview earlier this month if Twitter might alter to make Apple remove it from the app store. “They say they’ll moderate and so… “I trust them,” Cook said. Because no one wants hate speech on their platform. I expect them to continue.”
Last week, Twitter’s former head of trust and safety, Yoel Roth, who departed the business earlier this month, wrote in the New York Times that app store operators had started calling Twitter after Musk’s takeover. Roth called violating Google and Apple’s app store guidelines “catastrophic.”
Last Sunday, Apple app store boss Phil Schiller canceled his Twitter account.
Apple ran Black Friday adverts on Twitter on Thursday, though their relationship is unclear.
As the economy has weakened, many corporations have cut digital ad expenditure, and Twitter has likely always been a modest part of Apple’s budget. If Musk succeeds in converting Twitter’s core business to subscription revenue and needs to give Apple a 30% cut, Apple’s impact on Twitter may be considerably greater.
Musk tweeted, “Apple charges a concealed 30% tax on anything you buy through their App Store?” In another tweet, he showed a motorway exit with two lanes: “pay 30%” and “go to war.” Elon’s ancient automobile slid toward him.
read More Financial News Here
Returning Disney CEO Bob Iger Outlines His Objectives
After shocking the media industry with his return as CEO of Disney the previous week, Bob Iger visited the company’s headquarters on Monday to speak with employees for the very first time since making the announcement.
Iger addressed a variety of concerns that have been raised about the corporation, including the current hiring moratorium at Disney and the areas of concentration for the Disney+ streaming service that he has in mind. In addition to this, he emphasized that the most important thing for him to focus on as he regains control is creativity.
During a town hall meeting held at the company’s headquarters in Burbank, California, Iger informed staff that Disney’s hiring freeze would continue to be in effect – at least for the time being. His predecessor, Bob Chapek, made the announcement of the hiring freeze at the beginning of this month. Iger took over as CEO of Disney after Chapek, whose time in that role was brief but fraught with conflict. Iger has stated that maintaining the freeze is the “sensible thing to do” in light of the issues that are now facing the corporation. When addressing Disney’s overall “cost structure,” he also said that the length of time the employment freeze will be in effect will be a consideration for him.
The announcement of Iger’s return comes at a time when Disney is facing a great deal of hardship and criticism across its entire media empire. Disney is currently facing challenges in both the film and television industries. This includes a share price that has remained flat during the entire year as well as a streaming business that is expanding but is still losing money. Iger stated that when he departed the firm a year ago, Disney’s performance in streaming was being judged by a variety of criteria; nonetheless, growth was the primary element being considered. Since then, the emphasis has switched to “the bottom line” and “how much we are losing and when we will be profitable,” according to Iger’s statement.
He stated that the corporation should begin “chasing profitability” rather than “chasing subs with aggressive marketing and aggressive spend on content.” He stated that in order for Disney to accomplish this goal, the company must do a “very, very serious look” at the cost structure of all of its companies. However, Iger emphasized that “creativity” should be the primary focus of the corporation, as the returning CEO already stated that this endeavor will be his top priority.
Iger was asked about Disney’s creative muscle, and he responded by saying, “A number of you who worked with me know I’m obsessed with that.” “However, there is a logic behind my fixation on that. It is the engine that keeps the business going.
Iger stated that the quantity of content that Disney develops is not as important as the “greatness of the things that we do make.”
Iger wasted no time in making his stamp on the corporation and did so immediately. Soon after it was announced that he would be taking over as CEO, he reorganized Disney’s content distribution structure and announced that Kareem Daniel, chairman of the company’s Media and Entertainment Distribution unit, would be leaving Disney. Kareem Daniel had been the person responsible for overseeing the distribution of Disney’s content.
Iger tweeted a picture of Disney’s offices early on Monday morning, which was his first day back on the Walt Disney Studio lot. He captioned the image with the phrase “full with gratitude and delight to be back.”
Economic News3 weeks ago
Inflation Fell Last Month, But Higher Rates And Job Cutbacks Are Coming
Economic News3 weeks ago
Even Though Inflation Was Lower In November, Consumer Sentiment Dropped Sharply
Economic News3 weeks ago
Midterms Increase The Likelihood Of A Contentious Debt Ceiling Fight
Economic News3 weeks ago
Reasons To Begin Collecting Social Security At Age 62
Financial News3 weeks ago
Adidas Is Rebranding Yeezys, Kanye West’s Greatest Fear