I was including your notion that there should be no WC and this guy who lost his arm should get nothing. Both of them, taken together, are unjust in my mind. And many others--thus, the system we have.
Kamala’s take on the Economy
- Thread starter snarlcakes
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When I owned a restaurant one of our waitresses collected WC on us for slipping on our floor in the kitchen. It never happened. Some of her friends and fellow waitresses told us she fell off a bar counter in a dumpy bar while dancing drunk and half naked.
I argued with our WC to no avail. They paid her.
Edit: when she came back to work I changed her job from waitressing to peeling potatoes and washing dishes.
I’m about to get on a call with our factory manager in Pakistan. All the shit we’ve been talking about is why we manufacture there 🤣
Brad, appreciate your response.
I really meant to ask how many Personnel Injury cases actually go to trial.
A company's board is supposed to negotiate at arm's length a deal with the executives. The dirty little secret in corporate governance is that this happens all too infrequently. Delaware VCs are VERY familiar with this. Musk assembled a board beholden to him, that he controls rather than the other way around, and who then "negotiated" this pay package. This isn't atypical--private company guys want to treat a public corp like their own company, while still tapping public securities funding. But if you want that money, you have to follow the rules.
Under Delaware law,, once you prove the board is compromised--NOT an easy task, let me tell you-- the burden for proving a transaction is fair shifts to the board/Musk. That is a pretty high burden (some call it outcome determinative--called "the entire fairness" doctrine) and that's what Musk fell into.
It is not unjust for shareholders to have legal rules in place that their board members serve the interests of the company, and not the CEO.
The decision is here: posted online by Bloomberg News.
From the decision:
e. The Key Negotiators Said It All.
In the end, the defense witnesses said it all. Ehrenpreis and Gracias took the lead on the Grant for the Compensation Committee (recall that attendance at Working Group meetings was “optional” for Denholm and Buss).Maron was one of the primary go-betweens. When asked to describe the process, none viewed the process as an arm’s length negotiation. Each viewed it is as a form of collaboration with Musk. See Julian v. E. States Const. Serv., Inc., 2008 WL 2673300, at *19 (Del. Ch. July 8, 2008) (holding that the lack of historical precedent does not mean the size of the compensation plan can just be plucked out of thin air); Trial Tr. 1320:18–1321:16 (Murphy) (confirming that in a prior trial he testified that there should have been benchmarking for an executive if even he was the only person in the United States who was believed to be qualified and available to take that position). 725 JX-474 (6/30/17 email from Chang to Denholm and Buss). 726 See, e.g., JX-783 at 1–2 (1/16/18 email from Maron to the Compensation Committee) (stating Musk wanted that “[a]ny M&A in which [Tesla] buy a company for no more than 5% of [Tesla’s] current market cap will have no adjustment”); see JX-664 at 1 (11/9/17 email from Musk to Maron stating Musk would “like to take board action as soon as possible” on his compensation plan); JX-667 at 1 (11/12/17 email from Maron to Board stating: “We’d like to have another meeting on the issue of CEO compensation[.]”); JX-668 (11/14/17 email from Musk telling Maron to “pause for a week or two[,]” his compensation plan discussions); JX-718 (12/11/17 email stating the CEO compensation plan discussions are “back and on a fast track now”).
Ehrenpreis testified that “during the entire process, there were check-ins with Elon. We were not on different sides of things. We were trying to make sure if we were going to go through this exercise that he was on board.” Gracias explained his understanding of “fairness” in this context and his approach to the process as follows: [W]hat is important is that [CEOs] feel like they’re treated fairly. These plans are about incenting behavior. Behavior is a feeling. It comes from inside the mind. And so we focus on what’s fair and what feels fair to people and what’s fair to the shareholders, what’s fair to us as investors, what’s fair to the executives. That’s how we think about it. We never engage in these positional negotiations, I want 10, you want 3, let’s yell about it. That’s not how we do things, not how anyone does things.That is, in lieu of objective market data and arm’s length negotiation, the Compensation Committee opted for subjective feelings—“what feels fair.” The committee did not take “positional negotiations” against Musk.729 727 Ehrenpreis Dep. Tr. at 139:18–140:3 (emphasis added). 728 Trial Tr. at 808:16–809:14 (Gracias) (emphasis added). 729 Id.; see also Gracias Dep Tr. at 244:25–245:20 (“I did not have a positional negotiation with [Musk] about, hey, we want to give you one [tranche], and you want two and let’s go negotiate back and forth. . . . I did not have a negotiation starting lower and going higher with him about the tranches or the size of the award.”); id. at 255:22–256:9 (“Q. Okay. As a Tesla director and compensation committee member, do you think you have a duty to the company and the stockholders to try to negotiate for the smallest compensation package for Mr. Musk that would adequately incentivize him? A. That is not how I think about it, no. Q. Can you explain to me how you think about it? A. I think about compensation packages generally as what is fair to the executive and what is fair to the company. I don’t think about it as trying to get the very smallest thing possible ever. That’s just not my modus operandi with any company I deal with. I think about fairness.”).
Maron described the process similarly: “It was a cooperative, collaborative process. It wasn’t acrimonious. So when I say there wasn’t a conflict of interest, I think I’m thinking in my own mind was there an actual active conflict between the two parties; and I don’t think that there was. I think it was a cooperative collaborative process.” To deal with a conflict, one must first recognize a conflict. “Conflict blindness and its lesser cousin, conflict denial, have long afflicted the financially sophisticated.”731 Maron could not perceive the conflict, much less help deal with it. The testimony from the key witnesses is perhaps as close to an admission of a controlled mindset as a stockholder-plaintiff will ever get. The Compensation Committee and Musk were not on different sides. They did not acknowledge the existence of a conflict. It was a cooperative and collaborative process.733
3-5% (really high compared to most cases on the civil side) per Google AI quoting DOJ.
Be that as it may, I'd say that a executive comp plan consisting of options is inherently fair to shareholders. Tesla's shareholders made a ton of money on the appreciation of the stock.
I doubt anybody would've brought this suit complaining about the independence of Tesla's board if the options had expired worthless....which they easily could've done. So, ultimately, it was about the value.
But I thought it was terrific that Tesla relocated and got the package reinstated by shareholders. Fly a big, fat finger to those pricks.
The proxy was materially misleading. The board lied to the shareholders and were not forthcoming about how the deal was put together or the fact they were not independent of Musk. So the shareholder approval at issue in that decision was void.
What I think is that WC exposure should be balanced against the employer's share of the liability, whatever that is.
@mcmurtry66 mentioned having cameras. The arm guy's employer had them, the whole thing was captured on film. It doesn't matter. It doesn't even matter if somebody gets hurt deliberately (and, yes, it happens). It's also not uncommon for injuries which took place outside of the workplace to get WC benefits.
So, yeah, I don't think it's at all unjust for a guy who sticks his arm in a machine to not get WC benefits. Not gonna apologize for that.
Well, like I said, thankfully Tesla relocated to Texas where one can assume the courts aren't quite so knuckleheaded....and got the deal reapproved by shareholders. It'll be interesting to see what happens to the heroic lawyers who sought to get $6B for their heroism.
I think Delaware will survive.
That Musk could get the board to do his bidding--again--to move the incorporation to Texas is more proof that he controls the company and the board is not independent (ironically, proving the point of the very decision you are criticizing).
Not sure it's a good move for shareholders, having a Texas state court judge now making these big rulings, but I'm sure it'll be better for Musk, personally. But it's weird that you're cheering a move that will end up with less qualified judges making decisions regarding Tesla's corporate governance.
Not surprising, sadly.
We have a claim from 2018 that's still open -- from a guy with 30 years experience, who was violating safety policies, working on energized lighting circuits, without proper PPE, who had to kick himself off a ladder after taking 277V, and broke his back. His back has long been fine. But he's still getting PTSD treatments.
You see, it's my fault this idiot did something he knew he wasn't supposed to do. Despite all the training we do, all the site audits, all the processes for hot work (that he didn't do), all the PPE provision and certification, etc. etc. I could go on and on and on.
Last I looked, it's up to $500K. It's so good to know there's this kind of justice in America!!
I have zero sympathy for the plaintiffs in that case, their unbelievably brazen lawyers who sought $6B, or the judges who intervened. It's a matter between Elon, Tesla's board, and Tesla's shareholders. They approved it once -- until some doofuses who had nothing to do with it stuck their noses in it. And then they approved it again.
All I'm cheering is the fact that the people who tried to stop this didn't prevail. They shouldn't have.
Why do you suppose nobody challenged this compensation plan in 2018, when it was approved?
They only challenged it once it became apparent that the value had become so massive. To me, that's a tell. They didn't *actually* have issues with how it came to be. That was a means to an end. The issue was how much it was. There was a lot of money changing hands...which tends to create juicy opportunities for some enterprising lawyers.
How much money would the lawyers have been poised to collect (and from whom?) had they challenged the comp plan in 2018?
I think your take highlights the extremes and by no means the norm. For instance in comp you don’t get a payout for self inflicted injuries, injuries outside of work, if you violate co policy, do something illegal etc. and the comp defense lawyer puts the ee through the ringer. Hell the employer even gets to dictate the medical care. You have to go see “company” doctors
Are you telling me that nobody who gets injuries outside of work, has self-inflicted injuries, or violates company policy gets worker's comp benefits?
I know you're saying they aren't entitled to them. But they do get them -- all. the. time.
The fork truck guy violated company policies. But there aren't many people here, outside of me, who says that because of this he shouldn't be entitled to WC benefits. I mean "The guy lost an arm, for chrissakes! He'll never be able to work again. Don't you have a heart?"
I’m saying there are probably 3 million workplace injuries a year. The amount that shouldn’t be compensable is a tiny fraction of that 3 million that arent in the course and scope of employment. Witnesses etc. and judges understand meds. They know traumatic vs degenerative desiccation etc
What you’re saying happens but it’s the exception not the norm
I certainly didn't mean to suggest that it was the norm.
My issue is that it happens at all. And the context of me saying that is the suggestion, in this specific case, that it should've happened.
I mean...either we're serious about saying you don't get WC if you violated company policies or we're not. He violated company policies when he got off his fork truck. Yet I'm told that he absolutely should've been entitled to WC. Which is it?
Again without the facts i can’t say. And as frustrating as it sounds your acct isn’t enough info
If you knew all the facts, you'd summarize it basically as I have here.
I mean...I guess the employer could've chained him to the fork truck if they expected him to stay in it. Never thought of that.
WC is no fault.
I'm happy we have a system where someone who endured something like that can be compensated. PTSD is no joke.
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And usually…they ain’t worth a damn.
If I had my own pharmacy….I would never bill workers comp for a customer. They would pay up front and fight those bastages for their money.
OK, let me rephrase.
It's not my fault -- it's just my responsibility to pay for the consequences of his stupidity.
Years ago I had this grisly old cop that had seen it all. And the poor wc lawyer was a young girl. I’ll never forget she asked him why he didn’t go to the doctor directed. He goes : man”s a horse doctor. You go to him 🤣🤣
Nope look at the voter registration numbers vs 2020. And black women never for Trump anyway.
She will have to completely bomb the debate to lose PA….the game is won or lost in Wisconsin
I miss Cali, but not that ☝️By the way, gas prices are down out here in California too
She’s from Cali, why would it be any different? The Econ books that explain plainly how price controls break an economy never made it to the Golden State. Cut her some slack DBM, she’s simply unaware of the concept.
Kamala on the campaign trail mesmerizing her supporters...
Price controls never work, but we don't teach basic economics in schools anymore so it's an easy sell to the ignorant.
Blame higher prices on greedy businesses engaging in "price gouging" while ignoring the causes of the higher prices and the predictable results, then introduce price controls as a way to fix it.
Blame higher prices on greedy businesses engaging in "price gouging" while ignoring the causes of the higher prices and the predictable results, then introduce price controls as a way to fix it.
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Yep. It’s extremely annoying people will fall for evil corporations are greedy we need to fix prices. But it never dawns on them the real problem comes from increasing the money supply. We don’t need price controls. We need government and money controls.Price controls never work, but we don't teach basic economics in schools anymore so it's an easy sell to the ignorant.
Blame higher prices on greedy businesses engaging in "price gouging" while ignoring the causes of the higher prices and the predictable results, then introduce price controls as a way to fix it.
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PPI was the worst measured component of the 4. But when you hear people bleat about "record profits," they don't look at the margin, just the dollars. If my costs go up and I have to raise prices to cover cost increases, of course I'll have higher profits (assuming unit sales are constant). What is never discussed is the net margin likely hasn't increased and, in all likelihood, has taken a hit.
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“Price gouging” and “Tax cuts for the rich” are the two tell tale signs of an economic illiterate.
Price gouging/ collusion is a real phenomenon. Most frequently found when governments have narrowed themselves down to a preferred oligopoly of contractors who price collude and cause prices to go through the roof. Most often seen in Defense and Healthcare.
