Tesla Inc. chief executive Elon Musk will testify Monday U.S. time in the Delaware Court of Chancery over the company's $2.5 billion purchase of SolarCity.
Investors who are leading the lawsuit allege that Musk and Tesla's board violated their fiduciary responsibilities when they orchestrated the 2016 acquisition of SolarCity, an installer of rooftop solar panels.
They also claim it was rife with conflicts of interest and unfairly enriched the Musk family, who were among the biggest shareholders.
The plaintiffs allege Musk pushed Tesla's board to increase - not lower - the price for SolarCity.
The investors also allege Musk and others failed to disclose all pertinent information from the SolarCity deal.
Musk, who is the lone defendant, has insisted he was "fully recused" from negotiations over the purchase, reports said.
At the time of the all-stock acquisition, Musk - the second-richest person in the world - was SolarCity's chairperson and biggest stakeholder.
His $177 billion net worth is largely made up of stakes in Tesla and his rocket company, SpaceX.
The investors want Musk to repay Tesla the cost of the $2.6 billion bailout and disgorge the profits on his SolarCity stock.
If they win, it would be one of the biggest judgments against an individual.
"I think it's going to be very hard for the court to ignore the reality that Elon Musk is Elon Musk and his relationship with Tesla," Ann Lipton, a professor at Tulane University Law School, said in quotes by Reuters.
SolarCity had been founded by Musk and two of his cousins, Lyndon and Peter Rive, according to Market Watch.
There's no jury to persuade in this case. Musk's fate will be determined by DCC's judge, vice chancellor Joseph Slights III, CNBC said.
The case is expected to take roughly two weeks. The rest of the board have agreed to settle for $60 million in 2020, Bloomberg News said.
