A Delaware judge has cleared the way for Elon Musk and Tesla to begin a legal appeal process against the company’s 2018 pay package, which was initially rejected by Chancellor Kathaleen McCormick. The ruling marked a significant setback for investors who had approved the compensation plan in the 2024 Annual Shareholders Meeting.
According to reports, the Delaware Supreme Court will consider an appeal filed within the next 30 days. Musk and Tesla’s board can now challenge McCormick’s decision, which deemed the $56 billion pay package “unfathomable” in size. The judge also ordered Tesla to pay $345 million to the attorneys who represented Richard Tornetta, a shareholder who initiated a lawsuit against Musk’s pay package.
The ruling was met with criticism from Tesla, stating that it felt its decision was incorrect and that the court’s decision would undermine the rights of shareholders. Reuters notes that an appeal by the Delaware Supreme Court can take around a year to be resolved.
This development marks a new chapter in the ongoing saga surrounding Musk’s compensation package, which has sparked intense debate among investors and analysts.
Source: https://www.teslarati.com/judge-opens-path-elon-musk-tesla-56b-pay-package-appeal