Deal with Twitter could strengthen the reason Musk paid $56 billion for Tesla

Elon Musk's $44 billion acquisition of Twitter helped secure ammunition for an upcoming trial in which an investor would argue that the Tesla Inc. CEO pay package. ($56 billion) is a waste of money whose services have not been fully rendered-time.

According to one shareholder attorney, the deal for Twitter Inc (TWTR.N) and its potential to distract Musk from Tesla will play a significant role in the October trial. The lawsuit alleges that Musk created the 10-year package, and Tesla's board of directors branded it 2018 without the celebrity CEO having to dedicate himself to the electric vehicle maker.

"See most contracts with CEOs. The first line reads, "You will be a full-time CEO and will devote a lot of time to business and corporate affairs." That's the standard," said Greg Varalo of Bernstein Litowitz Berger & Grossmann, the company that is seeking wage approval. Musk and Tesla did not respond to requests for comment. In court documents, the defendants said the plan was drafted by an independent director approved by shareholders and had been approved shareholders.

Outside of Twitter, the multitasking entrepreneur is now chairman of rocket company SpaceX, founder of tunneling company The Boring Company, and owns Neuralink, a brain-chip startup. One of his ambitions is to colonize Mars.

Tesla's 2018 payout plan offers stock options if the company meets rising financial goals that will enhance its continued leadership position. If Tesla meets all of its so-called "stretch" targets, the plan will cost at least $56 billion, though as Tesla's stock rises, so will the value of the project. Continue reading

Musk's stake in the plan is currently worth about $75 billion, according to research firm Equilar's Amit Batish. He estimates that's about 35 times more than the combined value of the top 100 CEO pay plans by 2021. Read more

The case at Delaware law firm shareholder Richard Tornetta claims the package was unnecessary because Musk owned 22% of Tesla, giving him plenty of incentive to make the company successful.

Tornetta tried to scrap plans, including stock options already available. Musk used his stake in Tesla as collateral for a loan to buy Twitter.