Skip to main content

Unbiased. Straight Facts.TM

Tech

Elon Musk’s turbulent week: From $56 billion loss to massive Tesla recalls

Feb 5

Share

Media Landscape

See who else is reporting on this story and which side of the political spectrum they lean. To read other sources, click on the plus signs below.

Learn more about this data

Left 33%

Center 45%

Right 22%

Bias Distribution Powered by Ground NewsTM

Elon Musk faces a whirlwind of challenges, from a massive Tesla recall affecting nearly all vehicles to a $56 billion blow to his net worth after a Delaware judge’s landmark ruling. Amidst escalating legal battles, environmental scrutiny, and technological controversies, here are four of the biggest stories surrounding one of the world’s most controversial CEOs.

Unprecedented pay package overturned

A Delaware judge nullified a compensation deal for Musk, amounting to $56 billion. The legal challenge was spearheaded by Richard Tornetta, a heavy metal drummer and a Tesla shareholder who contended that Musk’s pay was excessively high and not in the company’s best interest. Judge Kathaleen McCormick agreed, describing the sum as “an unfathomable sum.”

Charles Elson, the founding director of the Weinberg Center for Corporate Governance, commented on the decision’s significance, emphasizing the court’s critique of the board’s independence and the problematic nature of the package.

“She is highly critical of the independence of the board, highly critical of the obviously, the package itself was problematic, from an incentive standpoint, and ordered rescission that basically the stock goes back to the company until the board comes up with a new approach,” Elson said. “That was surprising.”

Following this legal defeat, Musk’s position dropped to the second spot on Forbes’ richest billionaire list, trailing behind Bernard Arnault of Louis Vuitton. Musk also hinted at a possible move from Delaware to Texas for Tesla’s incorporation in response to the ruling and plans to appeal the decision.

Environmental stewardship questioned

Tesla faces legal challenges in California, where 25 counties have accused the electric vehicle giant of mishandling hazardous waste. The lawsuit alleges improper waste labeling and disposal, with potential fines reaching up to $70,000 per violation per day, according to California’s hazardous waste management law.

This isn’t Tesla’s first encounter with environmental scrutiny; the company has previously settled with the Environmental Protection Agency, resulting in $300,000 in fines.

Steering toward recall

The U.S. safety regulators have intensified their investigation into Tesla over power steering issues, potentially affecting over 330,000 Model 3 and Model Y vehicles. The escalation follows numerous complaints regarding steering control problems, significantly raising the stakes for the company.

Additionally, Tesla has initiated a recall of nearly all vehicles produced in the U.S., affecting over two million units due to inadequately sized font for warning lights on the display. This recall, however, can be addressed with a simple software update.

Musk’s week also featured the announcement of the first successful human implant of the Neuralink brain-computer chip, marking a significant milestone for the company. Despite FDA approval for human trials, the lack of registration with a government site raises questions about the transparency and ethical implications of Neuralink’s operations.

The technology aims to empower individuals with severe paralysis to control devices through thought, but concerns about animal welfare and the broader moral implications of such experiments persist.

Tags: , , ,

[SIMONE DEL ROSARIO]

IMAGINE – TESLA HAS TO RECALL NEARLY EVERY VEHICLE IT’S EVER MADE AND THAT’S STILL NOT THE WORST PART OF ELON MUSK’S WEEK. TRY LOSING 56 BILLION DOLLARS. 

HERE ARE THE FOUR BIGGEST STORIES FROM ONE OF THE WORLD’S MOST CONTROVERSIAL CEOS.

LAST WEEK A DELAWARE JUDGE STRUCK DOWN WHAT WAS A RECORD-BREAKING PAY PACKAGE — 56-BILLION DOLLARS. AND IT’S ALL THANKS TO THIS MAN.

THIS HEAVY METAL DRUMMER IS RICHARD TORNETTA, A VERY MINOR TESLA SHAREHOLDER. IN 20-18 HE DECIDED TESLA WAS PAYING ELON MUSK *WAY TOO MUCH MONEY AND FILED A LAWSUIT. TORNETTA ARGUED THE HUGE COMPENSATION PACKAGE WAS NOT IN THE INTEREST OF THE COMPANY OR ITS SHAREHOLDERS.

NEARLY 6 YEARS LATER DELAWARE JUDGE KATHALEEN MCCORMICK SIDED WITH TORNETTA – CALLING THE PACKAGE “AN UNFATHOMABLE SUM.”

CHARLES ELSON | Founding Director, Weinberg Center for Corporate Governance

“She is highly critical of the independence of the board, highly critical of the obviously, the package itself was problematic, from an incentive standpoint, and ordered rescission that basically the stock goes back to the company until the board comes up with a new approach. That was, that was surprising.”

[SIMONE DEL ROSARIO]

MUSK’S NET WORTH TOOK A MAJOR HIT, DROPPING TO NUMBER TWO ON FORBES RICHEST BILLIONAIRE LIST BEHIND BERNARD ARNAULT,  CHAIRMAN OF LOUIS VUITTON. 

AFTER BEING HANDED THE “L” – HE ASKED HIS FOLLOWERS ON HIS OWN PLATFORM IF HE SHOULD LEAVE DELAWARE AND REINCORPORATE IN TEXAS. 

MUSK PLANS ON APPEALING THIS DECISION.  

FOR A COMPANY THAT PRIDES ITSELF ON SUSTAINABILITY AND ENVIRONMENTAL STEWARDSHIP, FACING ALLEGATIONS OF MISHANDLING HAZARDOUS WASTE IS NOT A GOOD LOOK.

IN A SWEEPING ACTION, 25 COUNTIES IN CALIFORNIA ARE TAKING TESLA TO COURT. THEY’RE ACCUSING THE AUTOMAKER OF INCORRECTLY LABELING WASTE AND SHIPPING IT TO LANDFILLS NOT MEANT TO HANDLE HAZARDOUS MATERIALS. THE STAKES HERE ARE HIGH. CALIFORNIA LAW STATES FINES COULD REACH UP TO 70-THOUSAND DOLLARS FOR EACH INFRACTION, EVERY SINGLE DAY.

THIS ISN’T THE FIRST TIME TESLA HAS FACED SCRUTINY OVER HANDLING HAZARDOUS WASTE. THE ENVIRONMENTAL PROTECTION AGENCY SETTLED WITH TESLA ON TWO OCCASIONS, ONCE IN 20-19 AND AGAIN IN 20-22. TESLA PAID OUT 300-THOUSAND DOLLARS IN FINES.

NOW ONTO THE RECALLS. ON FRIDAY — U-S SAFETY REGULATORS CAME ONE STEP CLOSER TO RECALLING TESLA VEHICLES OVER POWER STEERING PROBLEMS.

THIS WOULD AFFECT MORE THAN 330-THOUSAND MODEL 3 AND MODEL Y CARS – ADDING FUEL TO A GROWING FIRE. WE GET THE IRONY. THE CARS DON’T TAKE FUEL.  

LAST YEAR – THE NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION STARTED GETTING COMPLAINTS FROM TESLA DRIVERS ABOUT THE STEERING WHEEL JERKING AND LOCKING UP, NEARLY CAUSING ACCIDENTS. 

THE PRELIMINARY INVESTIGATION IS BEING RAMPED UP AFTER NHTSA AND TESLA IDENTIFIED MORE THAN TWO-THOUSAND INCIDENTS. 

AND IN A LITERALLY TINY BUT MIGHTY RECALL NOTICE, TESLA *DID RECALL NEARLY EVERY VEHICLE EVER PRODUCED IN THE U-S ON FRIDAY – TOTALING MORE THAN TWO MILLION. THIS ONE IS BECAUSE THE FONT SIZE FOR ITS WARNING LIGHTS WAS TOO SMALL TO READ ON THE DISPLAY. LUCKY FOR TESLA, THESE RECALLS ARE FIXED WITH A SIMPLE SOFTWARE UPDATE. 

FINALLY – WHAT COULD HAVE BEEN A SIGNIFICANT TRIUMPH IN MUSK’S TERRIBLE WEEK IS UNDER ETHICAL SCRUTINY. 

MUSK ANNOUNCED LAST WEEK THE FIRST SUCCESSFUL HUMAN IMPLANT OF HIS NEURALINK BRAIN-COMPUTER CHIP. HE’S HAD F-D-A APPROVAL TO IMPLANT IN HUMANS SINCE MAY OF LAST YEAR. 

NEURALINK’S GROUNDBREAKING TECHNOLOGY HOPES TO GIVE PEOPLE WITH SEVERE PARALYSIS THE ABILITY TO CONTROL PHONES AND COMPUTERS USING JUST THEIR THOUGHTS.

MUSK DID NOT SAY WHO IS THE FIRST HUMAN, BUT NEURALINK’S BEEN ACTIVELY RECRUITING FOR CLINICAL TRIALS. THE NATURE JOURNAL NOTED NEURALINK HAS NOT REGISTERED ITS CLINICAL TRIALS WITH A GOVERNMENT SITE WIDELY REQUIRED BY UNIVERSITIES AND RESEARCH PUBLICATIONS. 

NEURALINK HAS PREVIOUSLY BEEN CRITICIZED FOR ITS APPROACH TO ANIMAL WELFARE AND THE MORAL CONSEQUENCES OF ITS EXPERIMENTS. 

WHILE THE INITIAL PURPOSE IS TO HELP THOSE WHO ARE PARALYZED, PEOPLE ARE ALREADY SPECULATING ABOUT WHERE THE TECH GOES NEXT. 

PAT MCAFEE | SPORTS ANALYST

“what i’m saying is we need to keep these things out of sports” 

 “if all of a sudden mac jones…then what’s the separator between brock purdy and mac jones”

[SIMONE DEL ROSARIO]

LEGAL BATTLES, RECALLS, AND TECHNOLOGY PUSHING SOCIETAL BOUNDARIES. IT’S ALL A WEEK’S WORK FOR ELON MUSK.