Several Tesla shareholders have recently filed a lawsuit in Delaware, accusing the company's CEO, Elon Musk, and the board of directors of intentionally diverting the company's talent and resources to Musk's competitive artificial intelligence company, xAI. This company, established in 2023, aims to understand the "true nature of the universe." The shareholders claim that Musk and the board have breached their fiduciary duties to Tesla by launching xAI.
For years, Musk has been trying to position Tesla as a powerhouse in robotics and artificial intelligence, rather than just a car company. This narrative has driven Tesla's stock price up, making the company's value exceed the combined total of all top car manufacturers. Meanwhile, Musk "diverted scarce talent and resources from Tesla to xAI, and promoted xAI's access to Tesla's AI-related data while raising billions of dollars for xAI," according to the lawsuit documents.
Tesla shareholders also cited a recent CNBC report, accusing Musk of ordering the transfer of thousands of AI chips manufactured by Nvidia, originally intended for Tesla, to a social media company. Following the publication of the CNBC article, Musk posted on xAI stating that Tesla, due to its unfinished factory in Austin, Texas, was unable to accept Nvidia's GPUs. He also estimated that Tesla would purchase AI chips worth $3 to $4 billion from Nvidia in 2024.
The shareholders further allege that the Tesla board took no action, allowing Musk to "plunder resources from Tesla and transfer them to xAI; creating billions of dollars in AI-related value in another company."
It is worth noting that this is not the only shareholder lawsuit this week. An institutional investor sued the company, claiming that Musk used insider information to sell Tesla shares and made billions of dollars.
