Lawyers who voided Elon Musk’s pay as excessive want $6 billion fee

By Tom Hals

WILMINGTON, Delaware (Reuters) -The lawyers who voided Elon Musk’s $56 billion compensation as excessive on Friday sought a record a $6 billion legal fee, payable in the electric car maker’s stock.

“We recognize that the requested fee is unprecedented in terms of absolute size,” the three law firms said in a filing with the Court of Chancery in Delaware.

The fee works out to an hourly rate of $288,888, they said.

Musk blasted the request as “criminal,” posting on his X platform that “the lawyers who did nothing but damage Tesla want $6 billion.”

Tesla and Musk’s attorney did not immediately respond to requests for comment.

The company would pay the lawyers who represented Richard Tornetta, a shareholder who sued Musk in 2018 over the pay package, which a Delaware judge nixed in January.

The electric vehicle maker is being asked to pay the fee because it benefited from the return of Musk’s pay package, which the legal team said will result in the return to the carmaker of 266 million shares.

“This structure has the benefit of linking the award directly to the benefit created and avoids taking even one cent from the Tesla balance sheet to pay fees,” the lawyers wrote, adding that the fee would be tax-deductible to Tesla.

Judge Kathaleen McCormick, who is overseeing the case and will decide on the fee, called Musk’s pay “unfathomable” in her ruling.

The company may object to the fee, as it has a fee request in a similar case over the pay for its directors.

The largest settlements in shareholder cases have occurred in federal court. The biggest fee was $688 million in 2008 for the legal team that obtained a $7.2 billion settlement in a securities fraud case over the failure of Enron Corp.

The Tesla fee request comes as the Delaware Supreme Court considers an appeal of a $267 million fee in a case that settled for $1 billion involving Dell Technologies.

Delaware judges have said that pursuing cases deep into litigation, through depositions and toward trial, should get…