Donald Ball v. Tesla, Inc.

COURT OF CHANCERY
OF THE
STATE OF DELAWARE
KATHALEEN ST. JUDE MCCORMICK LEONARD L. WILLIAMS JUSTICE CENTER
CHANCELLOR 500 N. KING STREET, SUITE 11400
WILMINGTON, DELAWARE 19801-3734

March 3, 2025

Thomas A. Uebler John L. Reed
Brian V. DeMott Ronald N. Brown
Adam J. Waskie Caleb G. Johnson
Terisa A. Shoremount Daniel P. Klusman
Allison M. Neff DLA PIPER LLP
MCCOLLOM D’EMILIO SMITH 1201 North Market Street, Suite 2100
UEBLER LLC Wilmington, DE 19801
2751 Centerville Road, Suite 401
Wilmington, DE 19808

Re: Donald Ball v. Tesla, Inc., et al.
C.A. No. 2024-0622-KSJM

Dear Counsel:

This decision resolves the parties’ cross motions for summary judgment on

Count I of the Amended and Supplemented Verified Stockholder Class Action

Complaint (the “Amended Complaint”).1

In Count I, the plaintiff seeks a declaratory judgment that Tesla Inc. failed to

secure the necessary stockholder votes on the proposal to reincorporate Tesla under

Texas law (the “Redomestication Proposal”). The plaintiff claims that the

Redomestication Proposal required “the affirmative vote of the holders of at least

66 2/3 % of the voting power of all then-outstanding shares of capital stock” under

Article IX of Tesla’s Certificate of Incorporation. Only 63% of Tesla’s outstanding

shares voted in favor of the Redomestication Proposal. Because the Redomestication

1 See C.A. No. 2024-0622-KSJM, Docket (“Dkt.”) 5; Dkt. 17; Dkt. 18.
C.A. No. 2024-0622-KSJM
March 3, 2025
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Proposal obtained approval of only 63% of the outstanding shares, the plaintiff claims

that the Redomestication is void.

The parties filed cross-motions for summary judgment on Count I.2 While the

cross motions were pending, Vice Chancellor Fioravanti issued a decision in

Gunderson v. Trade Desk, Inc.,3 resolving questions of law related to Count I of the

Amended Complaint. The parties agree that, under the reasoning of Trade Desk, the

defendants are entitled to summary judgment on Count I of the Amended Complaint.4

Thus, if I agree with and adopt that reasoning, summary judgment in the defendants’

favor is appropriate.

I have reviewed the well-reasoned decision of my colleague and adopt his

reasoning for purposes of this case. Under Trade Desk, the defendants are entitled

to summary judgment on Count I of the Amended Complaint. Further, partial final

judgment is appropriate because all the elements of Court of Chancery Rule 54(b) are

met.5

Partial final judgement is entered in favor of the defendants with respect to

Count I of the Amended Complaint.

IT IS SO ORDERED.

2 Dkts. 17, 18.

3 326 A.3d 1264 (Del. Ch. 2024), as revised Nov. 8, 2024.

4 Dkt. 42.

5 See Trade Desk, 326 A.3d at 1288.
C.A. No. 2024-0622-KSJM
March 3, 2025
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Sincerely,

/s/ Kathaleen St. Jude McCormick

Chancellor

cc: All counsel of record (by File & ServeXpress)