March 28 (Reuters) - A class action lawsuit by Tesla Inc shareholders against the electric car maker's chief executive, Elon Musk, and the company's board over the SolarCity deal was set to proceed after a Delaware judge refused to dismiss it.
Tesla agreed to buy solar panel installer SolarCity for $2.6 billion in an all-stock deal in 2016.
Musk was the biggest shareholder in both Tesla and SolarCity at that time, and his SolarCity shares were converted to $500 million of Tesla shares.
It is "conceivable that Musk, as a controlling stockholder, controlled the Tesla board" during the SolarCity deal, the judge commented https://courts.delaware.gov/Opinions/Download.aspx?id=270820.
The lawsuit alleged that the board breached its duties to shareholders in approving the SolarCity deal. (Reporting by Nivedita Balu in Bengaluru; Editing by Sriraj Kalluvila)