Delaware Judge Annuls Elon Musk’s $55.8 Billion Tesla Compensation Package

A Delaware judge has annulled Elon Musk’s massive compensation package valued at $55.8 billion from Tesla, potentially posing a significant financial setback for the billionaire who is recognized as the richest man in the world. Judge Kathaleen McCormick, who presides over the Delaware Court of Chancery, criticized the way the compensation plan approval process was conducted, calling it “deeply flawed” and raising concerns about the independence and transparency of the process. This court ruling implies that Tesla’s board must develop a new compensation proposal for Musk, following a legal challenge from shareholder Richard Tornetta, who alleged manipulation of the approval process and misleading communication to investors. Musk expressed his discontent with the decision through a tweet, where he advised not incorporating companies in the state of Delaware due to its pro-corporate policies. The annulment of Musk’s compensation agreement, which was sponsored by Tesla’s board of directors in 2017, has resulted in a 3.6% decline in the company’s shares following the market’s close. It remains to be seen how Tesla will move forward in developing a new compensation proposal for Musk, who holds a 13% stake in the company and has expressed his intention to increase his control over the firm.