New York City Comptroller Brad Lander has filed a lawsuit against Tesla and CEO Elon Musk, alleging breaches of fiduciary duties to the company’s shareholders. The city, which owns 3 million shares in Tesla, is seeking damages for losses of nearly $300 million due to Musk’s alleged mismanagement.
Lander claims that since Musk took over as CEO, Tesla has suffered financially, with a 40% decline in stock value over three months. He argues that the company’s board failed to provide independent oversight and that Musk’s actions, including funding his private AI company, have led to material misstatements misleading investors about his role at Tesla.
This lawsuit echoes recent concerns over Musk’s fiduciary duties to Tesla shareholders. Last summer, shareholders sued Tesla over alleged breaches of fiduciary duty regarding Musk’s AI funneling threats.
Lander is now adding that Tesla and Musk have been misleading about Musk’s role in the company for over a year. He argues that Musk has abandoned his responsibilities as CEO to focus on his private companies and President Trump’s MAGA mission.
The lawsuit seeks “a 10b-5 shareholder lawsuit against Tesla, on behalf of the New York City pension systems, for their material misrepresentations regarding the leadership of the company.” If successful, it could mark a significant blow to Musk’s management style.
Source: https://electrek.co/2025/04/02/nyc-sue-tesla-over-elon-musk-breach-fiduciary-duties