Tesla Shareholders in Tug-of-War Over Musk's $56 Billion Pay

A Delaware judge has ruled that Tesla CEO Elon Musk is not eligible for a $56 billion compensation package, despite a shareholder vote to reinstate it. The decision, led by Chancellor Kathaleen McCormick, challenges the package's excessiveness and impacts Musk's future at the electric car giant.

Elon Musk's ambitions at Tesla hit a roadblock on Monday when a Delaware judge upheld a decision against his entitlement to a $56 billion compensation package. Chancellor Kathaleen McCormick of the Court of Chancery reiterated her stance on the package's excessive nature, despite a shareholder vote aimed at reinstating it.

The judge's ruling comes as a surprise to investors who are now concerned about Musk's future role and compensation at Tesla, the world's most valuable automaker. McCormick's earlier stance from January already called into question the fairness of such a generous package.

Compounding the legal battle, McCormick ordered Tesla to compensate the attorneys involved in the legal challenges with $345 million. This amount falls significantly short of the billions the legal team initially sought, further adding complexity to this high-stakes corporate dispute.

(With inputs from agencies.)