The Delaware supreme court has reinstated Elon Musk's controversial 2018 compensation package from Tesla, overturning a lower court's decision that had voided the deal as 'unfathomable'. The package, originally valued at $56bn, could now be worth up to $139bn, according to the New York Times.
The ruling, issued on Friday, comes less than two months after Tesla shareholders approved a new plan that could be worth $1tn to Musk over a decade. Justices wrote that rescinding the pay would be 'inequitable' and would leave Musk 'uncompensated for his time and efforts over a period of six years'.
The case began seven years ago when a shareholder with nine shares filed suit, arguing the plan overpaid the world's richest person. A lower court struck it down, prompting Musk to relocate Tesla from Delaware to Texas and publicly attack the state's Court of Chancery and Chancellor Kathaleen McCormick.
Shareholders voted again in 2024 to approve the 2018 package, but McCormick struck it down again, ruling Musk had undue influence. The supreme court agreed there was a breach of fiduciary duty but ordered only $1 in nominal damages, deciding rescission was not appropriate.
Musk has urged other companies to leave Delaware, though only a few, including Dropbox and Coinbase, have followed. Tesla did not respond to a request for comment.
