The Falling Out

By 2007, the Roadster program was late, over budget, and the board -- chaired by Musk -- decided Eberhard was the reason. He stepped down as CEO that August, was shuffled into a powerless advisory title that November, and left the company entirely in January 2008, the same month Tarpenning also departed. Two interim CEOs cycled through in the following year before Musk took the job outright in October 2008.

Eberhard didn't accept the exit quietly. In June 2009, he sued Musk for libel, slander, and breach of contract, arguing that Musk's public description of his departure had misrepresented what actually happened. The suit lasted two months before Eberhard withdrew it; Tesla confirmed a settlement that September without releasing its terms. But one piece of the resolution became public and stuck: Tesla would formally recognize five co-founders going forward -- Eberhard, Tarpenning, Musk, Wright, and Straubel -- rather than crediting Musk alone, or Eberhard alone.

It is a small legal footnote with an outsized public afterlife. Musk is, by a wide margin, the person most people associate with Tesla's founding, and he has occasionally been imprecise about that history in public. But the settlement he signed says otherwise, in writing: Tesla exists because two engineers and an idea came first, and everyone who joined afterward -- investor, engineer, or otherwise -- built on top of that. It is a more crowded, more complicated founding story than the one-man version people generally know. It also happens to be the accurate one.