Hey everybody, welcome back to the Elon Musk Podcast. This is a show where we discuss the critical crossroads, the Shape, SpaceX, Tesla X, The Boring Company, and Neuralink. I'm your host, Will. Walden, the legal team representing Tesla shareholder Richard Tornetta, has adjusted their demand for legal fees in the case against Elon Musk's 2018 CEO Performance Award. Initially, Tornetta's team sought an award amounting to 29.4 million Tesla shares valued
over $5 billion. They have now proposed an hourly rate adjustment to $73,948, leading to a total fee of approximately $1.44 billion. Now, the Tornetta Verse Must case gained prominence in January when Judge Kathleen McCormick of the Delaware Court of Chancery an old Musk's 2018 CEO performance award. Tornetta's lawyers argue that their substantial effort justifies their proposed compensation. Initially, they requested a fee based on 29.4 million Tesla shares, which would equate to
more than $200,000 per hour. And Tesla has contested the fee request, proposing a much lower fee of $13.6 million for Tornetta's league team. Now Tesla's position was supported by Amy Stephens, a long time Tesla shareholder who also secured legal counsel to oppose the $200,000 hourly fee suggested by Tornetta's lawyers. In the revised filing, Tornetta's legal team offered an alternative perspective on the fee structure while rejecting Tesla's $13.6 million proposal.
They suggested a cash based alternative that would equate to an hourly rate of $73,948, totaling around $1.44 billion. This rate is a significant reduction from the initial proposal, but still reflects their extensive work on the case. Tornado's lawyers provided a detailed argument supporting their fee request. They cited historical precedents such as the Southern Peru case where $35,000 an hour rate was awarded over a decade ago.
Adjusting for inflation, this rate would be over $55,000 per hour today, which they argue justifies the revised rate of $73,948 per hour now. The lawyers argued that even Tesla's own estimates indicated a significant compensable value estimated at 2.3 billion. Using these estimates, they calculated that a low end cash award should be around 1.0842 billion. Based on the affirmed inflation adjusted southern Peru numbers. They noted that this would still
be lower than what they. Believe is fair compensation. Now, the attorneys pointed out that the southern Peru case involved penalties that reduce the final award, and in this case, the court penalized the plaintiff's counsel by reducing their fee request by 1/3 due to delays. And Tornetta's lawyers argued that without such penalties, the justified rate would indeed be around $73,948 per hour.
Now, Tesla has responded by seeking to delay the July hearing schedule to determine the legal fees, arguing that a recent shareholder vote approved Musk's pay package it that impacts the case, and Tesla's attorneys filed a request to delay the hearing, citing the June 13th decision by shareholders as significantly affecting the remaining issues. Now, Greg Varalo, representing Tornetta, countered that Tesla's attempt to re litigate the approval process for Musk's pay
package lacks legal basis. It should not delay the proceedings. He asserted that the shareholder vote has no legal effect after the court's judgement on the merits now. Varello emphasized that the court should move forward with the determining of the fee award for Tornado's legal team, arguing that they deserve billions of Tesla stock for the successful challenge. Delaying the hearing would postpone the final judgement and
potential appeal process now. Judge McCormick previously annulled Musk's pay package, finding undisclosed conflicts of interest among Tesla's board members, and Mccormick's upcoming ruling on the legal fees will finalize the case and allow Musk to appeal to the Delaware. Supreme Court. Now, Musk has reacted to the court's decision by threatening to pull his company's legal incorporations out of Delaware and calling for a new proxy vote to move Tesla's corporate home to Texas.
Now, Texas people and Tesla shareholders voted overwhelmingly in favor of this move. So Tesla's moving to Texas and Musk's called Relocate Tesla's corporate home and encourage other businesses to leave Delaware reflects his dissatisfaction with the state's legal decisions. Delaware's Chancery Court is known for its expertise in corporate litigation, housing more than 70% of Fortune 500 companies.
And despite the shareholder vote approving Musk's pay package, Elon still faces legal challenges and overturning the Delaware court's decision. The Court's ruling voided his 2018 pay package, which he must now appeal to secure. The resolution of this case will have considerable financial implications for both Musk and the legal teams involved. The final determination of legal fees will set a precedent for future corporate litigation and executive compensation cases.
The ongoing legal battle highlights the complexities of executive compensation and corporate governance, emphasizing the role of shareholder oversight in corporate decision making. The outcome will be closely watched by legal experts and corporate stakeholders. And if you have any stock in Tesla, be sure to watch this. See how this turns out. Because if Elon and company move everything to Texas, it could change everything. And remember, Elon threatened to pull away.
From. Tesla, if he didn't get his pay package, he said he'd take his ball and go someplace else and go play other places and he might not be able to do XAI or other things because of this pay and the AI for Tesla. Well. Some of it uses technology from XAI. So Elon was gonna take that away. I I don't know, it does it seem like a bratty move? If you, you know, what do you,
what do you think? It seems like a a move that almost a threat to shareholders that didn't approve of them moving to Texas. He just said, hey, I'm going to take all this money or I'm going to take everything else. So that's up to you to decide, whatever you think. And I think he's he should get the money because he did manage to get through all of the bullet points that he had to do. He had to achieve certain things, certain milestones and he achieved them all with flying colors.
So I think he should be getting the award for that money. How? As the case progresses, the Delaware court's decisions will influence not only Tesla's corporate structure but also the broader landscape of executive compensation disputes. The legal principles established in this case will guide future shareholder actions and
corporate governance practices. But ultimately, the court's final judgment will determine the appropriate compensation for Tornado's legal team and the validity of Musk's 2018 pay
package. The decision will shape the future of executive compensation litigation for Tesla and Elon Musk. Tesla and opponents of Elon Musk's $56 billion compensation package clashed on Friday over how to resolve the ongoing legal battle surrounding the pay deal and the substantial legal fees contingent on its outcome. Tesla contends that a recent shareholder vote to reinstate Musk's compensation plan should overturn a prior court decision
that nullified the package. The company has filed documents urging the Delaware judge to consider this vote and reverse her previous ruling. The dispute began when Tesla shareholders voted on June 13th to reinstate Musk's pay package, initially approved in 2018. However, this decision is pending while the lawsuit remains unresolved.
The shareholder vote occurred after Delaware Chancery Court Chancellor Kathleen McCormick voided the pay package in January, finding that the board's process was influenced by Musk's personal relationships with board members and inadequate disclosure of information about the deal. Richard Tornetta, the shareholder who sued to invalidate Musk's pay package, argues that the recent shareholder vote should not impact the court's earlier
decision. Tornetta's legal team insists that Tesla must appeal to the Delaware Supreme Court to reverse the January ruling. Additionally, they argue that before any appeal, Chancellor McCormick must determine the legal fees Tesla owes for winning the case. Tornetta's attorneys previously demanded 29 million shares of Tesla stock, valued at over $5 billion, as their legal fee.
On Friday, they suggested Tesla could alternatively pay $1.1 billion, a figure based on precedent in the Delaware Court of Chancery, though they described this amount as unfairly low. Tesla, on the other hand, urged the judge to address the implications of the shareholder vote first, which could potentially reduce the legal
fees. Tesla maintains that the pay package was re approved by shareholders and reviewed by an independent board member, addressing the judge's concerns about Musk's undue influence over the board. The company plans to file a motion to reverse the January ruling, arguing that the shareholder vote resolves the issues raised by the court. Tornetta's legal team disputes Tesla's position, asserting that the process for proposing the
ratification vote was flawed. They claim the shareholder vote was influenced by Musk's threats to shift his focus to artificial intelligence investments if he'd not gain more control over Tesla. This coercion, they argue, invalidates the vote's legitimacy. Musk's pay package, structured with performance based targets leading to stock option awards, was valued at $56 billion when
the last milestone was achieved. According to Tesla, the compensation plan requires Musk to hold the stock options for five years before exercising them. This intricate structure is now under legal scrutiny as Tesla seeks to uphold the agreement. The legal battle put significant financial stakes for Tesla. If the courts rule in favor of Tesla, the company can maintain Musk's pay plan and a $2.5 billion accounting charge recorded in 2018.
Conversely, a negative ruling could force Tesla to hold another shareholder vote on the compensation plan and potentially book a charge of at least $25 billion, threatening future earnings. Kevin Murphy, an executive compensation expert and finance professor at the University of Southern California, testified for Tesla during the trial. He emphasized the unprecedented nature of this dispute, indicating that it's resolution could set new legal precedents.
The outcome hinges on complex legal interpretations and the judge's decision making process. The spotlight now returns to Delaware Judge Kathleen McCormick, who ruled that Tesla's board did not act in the best interests of shareholders when approving Musk's pay package. Corporate law professor Anne Lipton from Tulane School of Law noted that McCormick must decide whether the new shareholder vote
reinstates Musk's pay plan. This could involve considering written and oral arguments or requesting additional information and discovery. Tesla has requested an expedited schedule for submitting court documents to present further rationale for their positions. The company aims for a final judgement from McCormick before taking further legal steps. Tesla's legal team describes the recent shareholder vote as one of the most well informed in recent history.
Citing support from major investors like BlackRock and Vanguard, Tesla reported that 72% of votes cast by shareholders, excluding Musk and his brother Kimball, favored the compensation package. The upcoming hearing before McCormick on July 8th will address unresolved matters, including the request for $6 billion in legal fees by Tornetta's lawyers, which Tesla disputes. Should McCormick validate Musk's compensation, she might also determine whether the shareholder vote retroactively
reinstates the agreement. As of 2018, Tesla claims this could save the company at least $25 billion, making the court's decision Making the court's decision even more crucial for the company's financial outlook. Kevin Murphy suggests that if McCormick acknowledges the shareholder vote, she might decide not to interfere further in the contract between
consenting parties. However, Murphy doubts this outcome, predicting that an appeal will follow with McCormick rules against Tesla And Lipton also anticipates that the losing side will appeal to the Delaware Supreme Court, indicating that Mccormick's decision may not be the final word on the matter. The case's resolution will likely involve multiple legal maneuvers and further judicial
scrutiny. The broader implications of this case extend beyond Tesla potentially influencing corporate governance and executive compensation practices. Legal experts are closely monitoring the proceedings given their potential to set new precedents in shareholder rights and board responsibilities. As the legal battle continues, Tesla's ability to sustain Musk's compensation package and navigate the associated financial challenges remains uncertain.
The company's strategy and legal arguments will be critical in shaping the final outcome and its impact on Tesla's future. The upcoming court hearing and subsequent legal proceedings will determine the fate of Musk's $56 billion pay package and the financial consequences for Tesla. The case underscores the complexities of executive compensation and corporate governance in today's business
landscape. Tesla CEO Elon Musk has confirmed that the company plans to spend between 3 billion and four billion on NVIDIA AI chips this year. This revelation came on Tuesday when Musk addressed the reallocation of NVIDIA H 100 Graphics Processing units, GPUs originally intended for Tesla, to his other ventures, X and XAI. According to CNBC, Musk diverted approximately 12,000 NVIDIA H100 GPUs from Tesla to these other
companies. This shift was confirmed by Musk in a post on X, where he stated that Tesla had no immediate use for the chips which would have otherwise remained in storage. The GP US are integral to Tesla's ambitions in developing its self driving technology. Tesla is constructing a substantial supercomputing infrastructure to support this, with the Giga, Texas facility nearing completion and slated to house 50,000 H 100 GP US dedicated to full self driving
FSD training. Musk's actions have sparked discussions among shareholders and analysts about the potential delays this could cause for Tesla's supercomputing projects. This reallocation might lead to months long delays in setting up the necessary infrastructure, a critical component for advancing Tesla's AI capabilities. The delays could add fuel to ongoing criticism from Tesla shareholders, who are concerned about Musk's attention being divided across multiple
companies. These concerns come at a time when shareholders are voting on Musk's $56 billion compensation package at the upcoming annual meeting. The financial markets reacted to the news, with Tesla's shares dipping nearly 1% on Tuesday, reflecting broader investor concerns. Meanwhile, Nvidia's stocks saw a 1.3% increase, continuing its upward trajectory with 135% gain year to date in 2024, driven by high demand for its GPUs.
Despite the reallocations, Musk remains optimistic about Tesla's chip procurement, estimating significant investments in NVIDIA hardware. He has stated that Tesla's AI related expenditures for the year will total around $10 billion, with about half dedicated to the company's internally designed AI systems and the Dojo supercomputer. The Giga, Texas facilities development is a focal point for
Tesla's future. Musk highlighted that the supercomputing center will initially require around 130 megawatts of power and cooling, with plans to expand to over 500 megawatts within 18 months. The facility's infrastructure includes massive cooling systems, underground water lines, and four large water tanks. Musk confirm these developments in a recent post on X, describing the center as a super dense, water cooled
supercomputer cluster. The facility is expected to play a crucial role in enhancing Tesla's self driving technology and AI capabilities. The diversion of GP US to X has potential implications for Tesla's timeline in achieving its AI goals. Musk's statement on X explained that Tesla's Austin factory is not yet ready to utilize the NVIDIA chips, justifying the temporary reallocation to prevent the chips from sitting idle.
This decision may raise questions among Tesla investors about Musk's focus and priorities, especially given the company's ambitious targets for autonomous driving technology. Tesla is set to unveil its first robot taxi vehicle in August. Tesla's self driving technology, particularly its Autopilot and Full Self Driving features, has faced scrutiny following
multiple crashes and fatalities. These incidents have put additional pressure on the company to demonstrate progress and reliability in its autonomous systems. Meanwhile, Musk's AI startup XAI is positioning itself as a competitor to giants like Open AI and Google.
Last month, XAI announced a $6 billion funding round aimed at advancing its AI capabilities and developing new applications for generative AI. NVIDIA, a critical supplier in the AI industry, has seen substantial growth driven by the demand for its GPUs. CEO Jensen Huang highlighted during a recent earnings call that the company's products are in high demand, contributing to a 200% increase in revenue last
quarter. Nvidia's success is tied to its ability to supply essential hardware for AI advancements across various industries. The company has become the third most valuable in the world, reflecting its pivotal role in powering AI research and applications. Musk's confirmation of Tesla's substantial investment in NVIDIA chips underscores the ongoing collaboration between the two companies. This partnership is expected to bolster Tesla's efforts in AI and autonomous driving.
Despite the temporary reallocation of resources, the developments at Tesla's Giga Texas facility and the integration of NVIDIA hardware are crucial for the company's future AI endeavors. Elon Musk's strategic decisions regarding NVIDIA chips are indicative of his broader vision for AI across his various enterprises.
While the immediate reallocation may pose challenges for Tesla, the long term prospects for AI advancements remain strong, driven by significant investments and ongoing developments in supercomputing capabilities. Blue Origin has called upon the Federal Aviation Administration to impose restrictions on the number of Spacex's Starship launches from Kennedy Space Center.
This recent move is part of the ongoing rivalry between Jeff Bezos and Elon Musk. Blue Origins complaint aims to limit Spacex's Starship operations at Launch Complex 39 A currently the site for Falcon 9 and Falcon Heavy rockets. SpaceX plans to use this complex for its Starship launches, proposing up to 44 launches annually.
The FAA in May released Spacex's proposal for these high frequency Starship operations at Kennedy, including the necessary infrastructure to support such a launch schedule. The public comment from Blue Origin is the latest chapter in a long standing feud between Bezos and Musk. The two have frequently engaged in public and legal disputes over Space Flight supremacy, with both aiming to pioneer
space tourism. Musk, known for his sharp retorts, responded to Blue Origins filing on social media platform X, which he owns, with the comment Sioux Origin. He further accused Blue Origin of using legal maneuvers to slow
down Spacex's progress. Although Blue Origins comment holds no legal power, it will be considered by the FAA as they decide on the restrictions for Starship's operations at Kennedy. SpaceX is in the process of obtaining a Commercial Launch Vehicle Operator license for Starship at Launch Complex 39 A. This process includes preparing an Environmental Impact Statement EIS under FAA supervision to assess potential environmental impacts.
The maiden voyage of Starship ended in an explosion, causing significant damage and prompting an FAA investigation. The blast from the launchpad in Boca Chica, Texas, damaged property up to six miles away, leading to legal action from environmental groups against the FAA. SpaceX has since improved the launchpad at Boca Chica to better contain debris and mitigate environmental impact. Despite these improvements, Blue Origin is leveraging the
incident in its plea to the FAA. Blue Origins public comment cites the environmental scrutiny Starship operations have faced, including the lawsuit against the FAA, as a reason for the FAA to limit Starship launches at Kennedy. Blue Origin also has operations at Kennedy Leasing Space Launch Complex 36 and other facilities at Cape Canaveral Space Force Station. The company employs over 2700 people in Florida with significant investments in
infrastructure at the site. The filing expresses concern about the safety of Blue Origins property and personnel in case of a Starship launch anomaly, such as explosions or debris. It also mentions potential interference with shared infrastructure and limited resources. Blue Origin pointed out the massive fuel capacity of Starship Super Heavy Booster, highlighting the potential for significant environmental impact and safety hazards that could affect other operations at Kennedy.
The company urged the FAA to cap the number of Starship launches, limit launch times, and invest in infrastructure to make Kennedy safer for other launch providers. Blue Origin also called for compensation for commercial activities impacted by Starship and penalties for SpaceX if it violates its EIS or license. Blue Origin is developing its own heavy lift rocket, New Glen, which has faced delays and has
not yet flown. The rocket has secured several contracts, including one with NASA for a Mars mission, but the rivalry with SpaceX remains fierce. The rivalry has been especially public, with legal battles and public taunts. After losing a court case against NASA in 2021 over the Artemis Human Landing System contract, Blue Origin later secured a separate contract as a second provider in the military sector.
Blue Origin recently won a significant contract with the US Space Force for 30 launches worth up to $5.6 billion, following previous losses to SpaceX and United Launch Alliance. Musk's public responses continue to reflect his contentious relationship with Bezos with accusations of legal obstruction rather than direct competition. Blue Origins latest filing underscores the intense competition and ongoing disputes between the two space companies.
The FA as decision on the requested restrictions for Spacex's Starship launches will be an important move for the company as it will need hundreds of launches from Kennedy Space Center for the lead up to launch astronauts to the moon for the Artemis missions. Can we for one second?
Think about SpaceX launching hundreds of Starships every single year, both from Boca Chica, Starbase Texas, and Kennedy Space Center in Florida. Now there are two companies that made it very apparent that they don't want this to happen. They did this the other day. And this is a thing that we have to talk about as a community and as people that want to see humans go to space, live on the moon, live on Mars.
And these two companies want SpaceX to be halted from sending anybody to the moon for the Artemis program or in the future to live on Mars. They made this very apparent in some posts the other day. And Christian Davenport on X posted this and A finally with the FAA regarding Spacex's proposed use of Pad 39 A for Starship.
Blue. Origin, Jeff Bezos's company, asked for a cap on the rate of Starship Super Heavy launch, landing and other operations, including but not limited to test firings, transport operations and fueling. Blue Origin also says there should be mandatory penalties for SpaceX for conducting operations not included in an EIS or other environmental restrictions, violating a launch license or any other laws, regulations, or other rules for operating. OK, let's take a look at this.
So this reads, super heavy operations are expected to have a greater environmental impact. Remember that part, The environmental impact part is extremely important here than any other launch vehicle currently operating at KSC Super Heavy can hold up to an unprecedented 5200 metric tons of liquid methane for propulsion, resulting in qualified distances for safety margins that potentially overlap the operational sites of other companies, the government and
the public. Now Blue Origin is talking about their own facilities at Kennedy Space Center here. Also the government, they pull them into this too, and the public which does regular people doing regular jobs, which is just people landscaping or doing whatever, you know, whatever they do. Now the scary part is they included environmental impact with this and this is where it gets a. Little.
Bit dirty now. The data qualified quantifying these qualified operations operation distances has not been published, but given the anticipated super heavy launch rate and vehicle impact, the impact of super heavy operations at Kennedy Space Center maybe even greater than at Starbase. Now let's go on a little bit further. According the EIS should thoroughly evaluate the considerable risks, alternatives, mitigations and resources listed below. The issues raised herein are
reasonably foreseeable. OK. Capping the rate of Super Heavy launches, landings, and operations. Capping basically cutting off SpaceX at the kneecaps so they can't do any launches or very few launches from Kennedy Space Center. Also no test firings. Transport operations, fueling to a number that has a minimal impact on local environment. Locally operating personnel and the local community.
They're just talking about the locals in consideration of all risks and impacts, including but not limited to anomaly risk, air toxin and hazardous materials dispersion, Rd. closures, and heat and noise generation. They're basically calling out SpaceX here. It's making them seem like monsters. Government investment in additional launch infrastructure that would make more launch pads available to other entities in a manner that de conflicts the
Super heavy operations. From other launch providers basically saying, hey, give us the. Opportunity to continue doing our own launches while SpaceX is doing their Starship stuff. It's a pretty big document and it seems pretty sketchy in my opinion and I'm going to get into. That a little bit later. Why it's sketchy? What they want to do is put a public perception of SpaceX into the zeitgeist. The SpaceX is bad and Blue Origin is good. Jeff Bezos, Oh, he's such a good guy.
Elon's unhinged. He's crazy. Look at this guy. He does all sorts of wacky stuff. He's a Wildman. Jeff Bezos secretly undercover builds this massive rocket that's in direct competition with SpaceX. Direct competition was super heavy. So by softening the blow with a greater environmental impact statement on the 1st sentence, they make people think. They make the government think, oh, this is going to be bad. It's bad for the environment. Nobody wants to mess up the
environment. I don't I, I mean, you don't want the water to get polluted. You don't want all of that wildlife to die. Oh my God, what could happen if SpaceX, if something happens, if SpaceX is super heavy rocket at Kennedy Space Center, That's what they that's what they say. This is a direct attack against SpaceX. Now, mind you, the second sentence, unprecedented 5200 metric tons of liquid methane for propulsion resulting in qualified distances for safety margins.
I understand this part that potentially overlap the operational sites of other companies, the government and the public. OK, so this part is true. When Starship launches, the safety precautions that will be needed for people, planes, boats, other companies, it's a big kind of blast radius for this thing. They have to be 7 miles away. And some of these companies, including Blue Origin, aren't in that. They are inside that blast radius.
They're not in the safe zone. So Blue Origin during these launches, if there's going to be hundreds of launches per year, that could be 100 days that SpaceX takes over Kennedy Space Center. So this part of it totally understand Bezos totally get it. Dude you look like a super villain. OK, you have your giant yacht.
You. Have all the money in the world and you also don't want this to stop your giant rocket from launching and for your from your company from making money which totally get it. Bezos is a savage businessman and he will go after anybody that impedes his companies in
any single way. So SpaceX here, if Blue Origin is in the blast radius of Starship super heavy, the keep out zone from launches and of test flights, SpaceX, Elon actually said they're not going to do test flights from Kennedy Space Center, but they have to, right? They have to get the the Starship ready to go at Boca Chica, Starbase, Texas. But the first flight that they do from Kennedy Space Center, it's not not a test. They're going to be testing all the systems the first time.
Sure, it might be a successful launch and landing of the Super heavy Starship, but it also could be, you know, a, a test of sorts because they've never flown from that position before from that spot. So from the Kennedy Space Center launch tower that isn't even built yet, it's kind of a test. So Bezos and company over here at Blue Origin, they kind of have a point. I mean, that part of it, yeah. But the whole environmental impact thing, that's.
Just a cover up. For what they really want, and that's for SpaceX to get sued, they want legal precautions put in place, mitigations if you will, for SpaceX. So they can't launch from Kennedy's Space Center. They want to hold them within red tape, strangle them for years to come for within a environmental assessment, environmental impact studies possibly could take years to complete. Environmental impact studies,
you know they say here. Accordingly, the EIS Environmental Impact Study should thoroughly evaluate the considerable risks, alternatives, mitigations, and resources listed below. Issues raised herein are reasonably foreseeable. Now, here we go. This is the part that gets a little bit wonky. They're way ahead of everybody else. So why would SpaceX not want to keep going forward here? Elon and company, they're gonna keep working no matter what.
They're going to keep doing whatever they whatever they do at Boca Chica, they're gonna make that second tower. They're in the process right now on everyday Astronauts channel, he interviewed Elon and Elon said they're building a brand new tower. Everything's brand new. The tower that we see now, it's going to be garbage compared to this new tower apparently. And they're going to upgrade everything, a new water system, new flame trench type system, he
said. Elon said the engineers are going ham on this thing and building a a better tower. So bigger tower, better tower. And in here they say the government investment in additional launch infrastructure that would make more launch pads available to other entities. So basically, hey, we won't have the ability to launch when SpaceX has Super Heavy ready to launch. We won't be able to do any of our operations. We need. We need the room, we need the
space, we need the time. So build us another pad, get us all the other stuff that we need, the the roads, whatever we need. We need like some other ways to do our job. Totally get it. And is Elon and SpaceX pushing the boundaries of Space Flight? Yes. But is he pushing back on people that are slow? Yes. You know, if if Blue Origin can't keep up with them, then what is what is Blue Origin supposed to do? They're going to sue them. They're going to sue you.
Sue the hell out of them. And the FAA is gonna go along with it. You know the FAA isn't gonna go along with it, but the FAA. This is a letter to the FAA, by the way. This isn't just something they put out there. So here's another second company. So not only was it bad that Blue Origin was doing this, but also the ula has entered the chat. What is up? Tori, Tori Bruno, You have a cool cowboy hat. You have a cool mustache.
When you grow it out, you ride a horse, you have a giant rocket company that's worth billions of dollars, but yet you joined up with Blue Origin to also attack SpaceX, and it seems kind of sketchy. I'm not going to lie here. I want everybody to get along. I want all these rocket companies to work together so people can work and live on the moon and go to Mars. Why would you want to stop that? The reason is it's Monday. Moolah Big green.
Now this is what Ula had to say. As a threshold matter, the EIS must acknowledge that Starship is still in experimental stages. SpaceX plant operations at LC39A Kennedy Space Center have evolved and continue to evolve. We know it's a test vehicle right now the FAA knows Starship is the largest rocket ever built and is currently tested at Spacex's private base in Boca Chica, Texas and in prior test results test flights SpaceX Now this is the scary part people has experim experienced several
technical accidents. In addition, SpaceX has acknowledged that the vehicle is not meeting anticipated performance levels, and as a result, SpaceX has indicated that it plans to increase the size and thrust level of the vehicle stages to address this performance shortfall. This would result in environmental and safety issues greater than those witnessed at Boca Chica. Let's scare the pants off everybody. Let's just scare them, OK? They have a big rocket.
We know that it's gonna have more thrust than anything. Everybody knows that the FEA works completely hand in hand with SpaceX. So it's not like the FEA doesn't know this stuff. And I can't believe they did this on the same day as Blue Origin, within the within 24 hours of each other. Come on, Tori. You know what, Tori? I'm not mad about this. I'm just disappointed in you. You could have taken the High Road. You could have done the right thing. You could have competed with
SpaceX directly. You could have spent money building reliable reusable rockets that could be launched from an American launch provider with such a heritage and prestige. Like ula you could have just fought them hand to hand combat. But instead you're using sneaky tactics. You're being a little sketchy here. You're talking at the side of your mouth. You should be talking straightforward instead of saying this environmental stuff, these rockets, they're going to hurt things.
Yeah, it's in a it's, it's a deal, right? The FAA, SpaceX, it's a big deal. It's a big rocket. But instead you took the low Rd. Tory Ula and Blue Origin. If you think they're not working together on this, they're both posted within the same 24 hours. There's some stuff going on here between these two companies. People talk, they're in the same industry, they work right down the road from each other. So of course, somebody wrote an e-mail, hey, we're going to release this thing or ula.
Saw. What Blue Origin did and said, hey, we can do the same thing. Let's get on, Let's get them guys, make a better rocket that can compete with the Super Heavy. You wouldn't have to worry about this. OK, so there's other parts to this that we can go through, and Blue Origin covered most of it. But they're disguising this as an environmental issue when in all actuality, this is about money, baby. Billions of dollars that they could be getting from the government and from other sources.
Department of Defense, private contractors flying satellites into orbit, whatever it is ula Blue Origin. See the writing on the wall? They're scared. They're backed up into a corner. SpaceX is eating their lunch. Now these two are trying to fight back. They're trying to be the bullies. But what they're doing here is they're being sneaky, and they're being, let's just say, a little bit underhanded.
They're using the system, the FAA and the government to their advantage, and they're coming directly at SpaceX for this. Now, remember, if SpaceX gets tangled up in this red tape, they could be stuck in it for years to come. And we couldn't see a SpaceX Starship launch from Kennedy Space Center for two, maybe three years because of this. What happens to the Artemis program because these two petty companies are attacking SpaceX? I understand where they're
coming from. If they're in the blast radius of a Starship, figure it out. The FAA, SpaceX, Kennedy Space Center, they'll all figure it out. And because these two bigger companies, these two big companies, massive rocket companies are working with the government and they're working with NASA, Kennedy Space Center, etcetera, they have some pull. So I get it. I totally get it, but just do it the right way.
Let them handle their business. I understand where you're like where you're airing this out right now, but it's pretty sketchy. It's pretty like obviously you work together on this. No matter Like show us, show us, show us that you didn't show us that you didn't work together. How about that? OK, that's pretty. It's very funny though, that like they didn't, they didn't expect us to get that. Do you do it right? Let them go through the proper channels. The FAA. Let them do their thing.
If the FAA says they're ready to go, then they're ready to go. SpaceX intends to launch a larger model at LC39A than it is currently testing in Boca Chica. SpaceX reveal plans to at minimum quadruple payload size to make up for shortfalls. I'd like this the shortfalls in predicted performance. Starship will. Eventually be 400 and. 92 feet tall, by the way, That's freaking huge. 500 feet tall. 50 story building what? In the world.
Is going on super. Every booster is expected to hold up to 4100 metric tons of propellant, the Starship up to 2600 metric tons. The maximum liftoff thrust is anticipated of 103 mega Mega Newtons, resulting in launch impacts would far exceed current impacts seen during current Boca Chica launches. Yeah, it's a bigger rocket. We know additional growth of the Starship. Launch vehicle may be planned if performance continues to fall
below expectations. Given these changes, EIS must perform a comparative analysis between current usage impacts and the proposed operations, with a rocket proposed to be more than double the size of any current licensed launch vehicle and with increased frequency of launches. So hundreds of launches per year, hundreds of launches say 100 launches say even 50 launches per year, 50.
Launches that's. 50 days that some of these engineers and workers in the office anywhere, any driving a truck, who knows what you're doing out there. You could just be like watering the lawn, doing landscaping at Kennedy Space Center, but you couldn't do it. Because. SpaceX is launching a Starship. I get it. Tori. I I. Understand where you're coming. From. SpaceX and the FAA work like this. They work like this. They also do this.
That's a magic trick, by the way, children, this, that's a trick my dad taught me anyway, not to be a little bit weird, but that's a cool thing you can do, by the way, and show people that you have magic fingers. And if you do it to a little 3 year old, they're going to be like what has happened?
SpaceX knows what they're doing. They've been working with the FAA since inception, and the FAA is very knowledgeable about what's going on in Boca Chica. They have to be because they're operating with SpaceX. They're authorizing SpaceX to launch these rockets from Boca Chica, so they know exactly what's going on. They did damage reports for the first second. 3rd. And upcoming launches, they're doing all that stuff with SpaceX and they know what SpaceX is
planning. So anything they do here, anything that Blue Origin or ula does, it's just them beating their chest and shoving SpaceX to the side and saying, hey, let's wrap you up in some red tape. Let's do another environmental impact study. They putting up pressure on the FAA. It could. Happen. And SpaceX could be stuck in that red. Tape. For two years while they do an environmental impact study to see if anything is gonna happen with the Starship. If.
Anything goes wrong? Do you think this is right? Ula and Blue Origin, do you think this is the right way to do it or do you think that, you know, making this public and posting these things on the same day, You don't think this is an attack, direct attack on Space X2? Two of the biggest. Space Flight companies in existence just just so. Happened to have the. Same idea on the same day. It's so cute, so cute. June 25th. Hey, I got this idea.
I think I'm going to post something on my account about the FAA. This is pretty cool. And then that was Blue Origin, by the way. And then ula goes, I got an idea. You got this really great idea. I think I too am going to post something that I don't know anything about Blue Origin, but I'm going to do it myself. Let me just post this. And nobody, nobody knew that this was going to happen. Whatever, dude. These companies, they're talking
to each other. There's some background stuff going on. They're both like, yo, what are you going to post today? Hey, let's post this up, dude. There's like two people, you know, there's. There's like this. Scheme. You know how you always think like those people that are like, oh, there's like a dark whatever. In the background. That's controlling things. It's just people, right? But these people are weird.
Like these two entities ula and Blue Origin, they're like, let's make the maximum impact against SpaceX. Let's do it together, let's fight SpaceX. And if we do it and there's two of us. SpaceX can't. Fight us, because we're gonna. Get the FAA involved, we're gonna wrap him up in this red
tape and they'll never get out. And then me being Blue Origin, I'll be able to launch my giant rocket from Kennedy Space Center before SpaceX launches their rocket from Kennedy Space Center. You get a little bragging rights. You might get some contracts that SpaceX doesn't get because you have a flight proven. Rocket. SpaceX doesn't have that yet. You might get big. Contracts you might. Get government contracts. You might get Department of Defense contracts that are only awarded to.
Rockets that have. Made it to orbit or have done other certain things. And if Blue Origin can push SpaceX back from doing that from Kennedy Space Center, who knows what kind of contracts they could get. Millions of dollars, billions of dollars worth of contracts the SpaceX might not get because Jeff Bezos and company ula included Tori calling you out. Cowboy hat looks cool. That big mustache you had look cool. But you know what? You're a punk. Stop it. Stop it, Jeff Bezos.
Stop it, Tori. You're being babies about this. SpaceX is going to work with the FAA. You didn't have to do. This this. Is such a bitch move, dude, come on. Come on. I know my channel's like for fun, but this is a real bitchy thing to do, so come on. That's all I'm saying. Christian, Thanks. For posting this. Washington Post Christian Davenport Good, good tweets but. If you like this kind of. Commentary and you want to be part of this community, please.
I urge you to hit the thumbs up and the subscribe button if you're on YouTube. If you're on your podcast platform, please hit the follow button because it does help out the channel tremendously. Now, if you are on YouTube and you do a thumbs up and you do the subscribe and you do a comment too, that'll be great too. If you don't have anything to really say to add to the commentary there, please just post a rocket emoji.
That'd be great because we all like Space Flight, but the algorithm's going to pick that up for you. Not just for me, but for you. And they'll start sending you more spaceflight content, not just from this channel, but from other spaceflight creators that you might not have heard about. I do it all the time. I get random spaceflight people. I'm like, oh. They have a different perspective. This is cool. So that's what the algorithm does for you.
Some podcast players do that too, but on YouTube, that's exactly what it does. So please, like, comment, subscribe, and if you really like this stuff, please become a member of the channel because it helps me out and helps me continue to do these shows every single week and bring you all the news and commentary about all this weird stuff that happens in Space Flight, like this weird thing that happened today. Let me know in the comments what you think. All right, that's it for today.
Everybody please take care of yourselves and each other, and I will see you in the next one. Tesla shareholders have. Recently voted to ratify Elon Musk's 2018 stock options package, appearing to defy a previous court ruling that voided the pay plan. Now, this vote comes after a January ruling by Delaware Judge Kathleen McCormick, which rescinded Musk's compensation package due to concerns over undue influence and misleading information provided to
shareholders. Now, Tesla attends of the shareholder vote nullifies the court's decision, thus making a new development in the ongoing legal battle over Musk's $56 billion pay package. Now, in January, Chancellor Kathleen McCormick of Delaware's Court of Chancery invalidated Musk's pay plan. The judge determined that Musk's close relationships with some Tesla board members unduly influenced the negotiation process.
Moreover, the company was found to have inadequately informed shareholders about Tesla's progress toward meeting performance based targets. This ruling posed a significant challenge to Musk, who had been instrumental in Tesla's emergence as a leader in the electric vehicle market. Now the recent. Shareholder vote. Which took place two weeks ago approved the 2018 stock options
package. Tesla argues that this approval signals strong support from Musk's leadership and compensation plan, effectively indicating the January court ruling. According to Tesla's filing, the final court order should state judgment is entered for the defendants, indicating that the company and Musk have prevailed in this legal contest. However, the legal team representing the shareholders is contesting this outcome.
They're urging the judge to uphold her original ruling and mandate that Tesla pay them potentially billions of dollars in Tesla stock as legal fees. Richard Tornetta, the shareholder who initiated the lawsuit, has requested 29 million shares of Tesla stock that's at around $5 billion as their fee. Alternatively, they have proposed a $1.1 billion payment, which they argue is based on precedent but still unfairly low in their view.
Now Judge McCormick. Has ordered both parties to prepare briefs addressing the impact of the shareholder vote on the case. She has also scheduled oral arguments on this issue for late July or early August. On July 8th, McCormick will hear arguments specifically about the legal fees, with a ruling expected a few weeks later.
Even if she does not reverse her January ruling, she might consider the shareholder vote as an indication that Tesla shareholders support Musk's compensation, potentially undermining the fee request from the shareholders legal team. Now Tesla. 'S assertion in the court. Filing that Musk won the legal battle over his pay package because of the shareholder votes reflects the company's belief that this approval overrides the previous court decision.
Tesla's filing, made public on Thursday, argues that the shareholder vote should lead to a final order favoring the defendants, effectively siding with Tesla and Elon Musk. And the legal team for the shareholders maintains that the judge should adhere to her initial ruling invalidating Musk's pay package. They're seeing seeking a substantial legal fee award from Tesla, which they argue is justified by the value they provided to the company by having the pay package rescinded.
Tesla, however, contends that a fair fee might be as low as $13.6 million now. On Thursday, Judge McCormick directed both sides to begin preparing briefs outlining their positions on how this shareholder vote affects the case. She also instructed them to. Argue. On a date for oral arguments in July or early August and the judge will hear arguments about the legal fees on July 8th and may take several weeks to issue
her ruling. Now, even if Judge McCormick does not reverse her January decision, she might consider that the shareholder vote demonstrated a lack of value in winning the case between Tesla shareholders evidently support Musk's record-breaking compensation. This could significantly weaken the shareholders legal team's argument for a large fee based on the purported benefit they provided by rescinding the pay package and Musk's pay package, which is 56. Billion dollars.
Consists of performance based targets that trigger stock option awards. He must hold for five years before exercising when the last target was achieved. Now, the value of the package fluctuates with Tesla stock prices of course, which has declined by over 20% this year due to weaker consumer demand for E VS. Tesla's defense team, in a motion fell down June 20th, argued that the shareholder ratification vote vindicates
Musk's stock options award. They asserted that the consequences of the ratification change the litigations course, in effect any potential relief and attorney fees that might be awarded to the plaintiff's council. Chancellor McCormick, in response to Tesla's motion, wrote that she wants to conduct the hearing on the legal fees without considering the shareholder vote, as a separate meeting will be held to address the votes impact, she said.
Given that, we will hold a separate oral argument devoted solely to the questions raised by the stockholder vote. For the purposes of the July 8th hearing, the parties are instructed to argue the points at issue without regard to the stockholder vote. All arguments. Concerning the. Stockholder vote will be deemed
preserved now. James Park, a securities regulation expert at the University of California, Los Angeles, said there's an importance of considering the shareholder votes impact on the litigation's overall value. He said. My only thought. Is that the? Defendant is correct that it would be difficult to evaluate the benefit of the litigation, which is necessary to evaluate the fee request, without considering the impact of the shareholder ratification vote.
He added that McCormick. 'S response. Likely indicates that she is preserving her options. Attorneys for both Tesla and Tornetta, the plaintiff, have not responded to requests for our comments here, and the case outcome remains uncertain, with significant implications for both Musk's compensation and the shareholders legal fees. Somebody's going to be paid billions of dollars here now.
The ongoing legal battle over Musk's $56 billion pay package continues to generate considerable attention, and Tesla's contention that the shareholder vote nullifies the earlier court ruling adds a kind of weird dimension to this dispute. The final outcome will depend on the judge, of course, and. How they interpret? The shareholders vote impact and her ruling on illegal fees. But despite these challenges, Musk has continued to lead Tesla forward. It's challenging right now.
The EV market is dwindling and the companies face slower sales and increased competition in their sales. Musk is hinted at developing some new products outside Tesla if he doesn't secure a large ownership stake. This is a high stakes thing going on right now, and the resolution of this case will likely have broader repercussions for corporate governance in executive compensation practices going forward.
The involvement of Tesla shareholders and ratifying Musk's pay package shows that this is a complex matter. They have to balance this between shareholders, investors and the board and Elon Musk and also the courts and as the legal proceedings. Progress. The implications of the shareholder vote in the final ruling on legal fees will be in everybody's mind, and it may disrupt Tesla's stock going forward.
So be careful out there. This isn't stock advice, this isn't investment advice, but just be careful with what you buy in the near term if you. Plan on buying. Tesla 'cause this could have a could have a negative or positive impact depending on how this goes. So just take heed there. Hey, thank you so much for listening today. I really do appreciate your
support. If you could take a second and hit the subscribe or the follow button on whatever podcast platform that you're listening on right now, I greatly appreciate it. It helps out the show tremendously and you'll never miss an episode. And each episode is about 10 minutes or less to get you caught up quickly. And please, if you want to support the show even more, go to patreon.com/stage Zero. And please take care of yourselves and each other. And I'll see you tomorrow.