Elon packed the board with personal friends who would never in a million years turn down any compensation package he asked for. The extent of their relationship was not disclosed in public filings. It's reasonable for the shareholders to ask if maybe the money could have been better spent on R&D or a cheaper CEO than being shuttled off as personal funds for the CEO.
> Typical elements of the crime of embezzlement are the fraudulent conversion of the property of another person by the person who has lawful possession of the property.
You can read about the extent of the alleged fraud in the judgment, but it is clear that the board was nothing more than sycophants _not_ acting in the fiduciary interest of the shareholders.
https://courts.delaware.gov/Opinions/Download.aspx?id=359340
> The Proxy failed to disclose any of the Compensation Committee members’
> actual or potential conflicts with respect to Musk.747 In fact, the Proxy repeatedly
> described the members of the Compensation Committee as independent, stating:
> “The[] [Grant] discussions first took place among the members of the Compensation
> Committee . . . all of whom are independent directors;”748 and “[t]he independent
> members of the Board, led by the members of the Compensation Committee, spent
> more than six months designing [the Grant].”749 The Proxy’s introductory letter is
> “[f]rom the Independent Members of Tesla’s Board of Directors,” and the first four
> signatories are Compensation Committee members Gracias, Ehrenpreis, Denholm,
> and Buss.750 Notably, Gracias signed as “Lead Independent Director.”751
> The description of the Compensation Committee members as “independent”
> was decidedly untrue as to Gracias and proved untrue as to the remaining committee
> members.