Elon Musk wins appeal to restore $56B Tesla pay deal that was called ‘unfathomable’
Elon Musk’s pay package from Tesla, valued at $56 billion in 2018, has been reinstated by the Delaware Supreme Court, overturning a previous ruling that deemed the compensation deal “unfathomable.”
The court’s decision, which deemed the 2024 ruling rescinding the pay package as improper and inequitable to Musk, has restored the package to its original value.
The total rescission of the pay package was deemed unfair as it left Musk uncompensated for his efforts over six years, according to the 49-page ruling issued on Friday.
With the value of the 2018 pay package now estimated at $139 billion, Tesla shares saw a slight increase in after-hours trading following the ruling.
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Tesla’s board had expressed concerns that Musk, the world’s wealthiest individual leading multiple ventures, could potentially leave the company if his demands for pay and increased voting power were not met. Shareholders later approved a new pay package in November, contingent on Tesla meeting specific targets related to self-driving vehicles, a robotaxi network, and sales of humanoid robots, with a potential worth of $878 billion.
Tesla has implemented measures to mitigate the risk of legal challenges to the new pay package, including relocating its legal home to Texas, where investors must own a minimum of 3% of the company stock before filing a lawsuit for corporate law violations.
