Elon Musk’s $55.8 billion Tesla compensation package has been rejected once again. A U.S. judge denied the billionaire’s attempt to reinstate his high pay on Monday, refusing to overturn the previous ruling through a Tesla shareholder vote.
Monday’s decision follows a previous dismissal of Musk’s multibillion-dollar compensation package in January by a Delaware court. The court found that Tesla’s board had failed to act in the best interests of shareholders by blindly accepting Musk’s proposed pay without negotiation. The court also deemed the $55.8 billion package excessive and lacking provisions related to Musk’s actual work hours at the company.
Tesla shareholders vote to give Elon Musk a $56 billion pay package after a court shot it down
Musk expressed dissatisfaction with the ruling. In June, the same $55.8 billion compensation package was presented to shareholders for approval during Tesla’s annual meeting. Despite this approval, Musk and Tesla sought to reverse the previous ruling in court, arguing that shareholders have the power to amend court decisions in their favor.
However, Judge McCormick rejected this argument in her ruling this week, criticizing Tesla for introducing new evidence to challenge the court’s decision. She emphasized that newly created evidence like the June stockholder vote cannot alter previous rulings. McCormick also noted misleading statements made by Tesla to shareholders prior to the ratification vote.
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The court stressed the importance of upholding legal decisions and the duty of company boards to act in the best interests of shareholders. Musk’s objections on social media were countered by Tesla, which announced plans to appeal the ruling.
“A Delaware judge has overturned the decisions of Tesla shareholders who twice voted to pay @elonmusk what he deserves,” tweeted the official Tesla X account. “We will appeal this decision. Shareholders should control company votes, not judges.”
Addressing these assertions, the court clarified the role of board members as trustees obligated to act in shareholders’ best interests.
