Judicial Stalemate: Musk's Tesla Pay Package Faces Fresh Hurdles

A Delaware judge has reaffirmed her stance against Tesla CEO Elon Musk's $56 billion pay package despite shareholder support. The ruling casts uncertainty on Musk's future with Tesla. McCormick criticized Musk's influence over pay negotiations and the company’s misstatements. An appeal to the Delaware Supreme Court is pending.

In a controversial decision, a Delaware judge has maintained her opposition to a substantial $56 billion compensation package meant for Elon Musk, CEO of Tesla, even after the company's shareholders voted to reinstate it. The ruling by Chancellor Kathaleen McCormick of the Court of Chancery continues to challenge Musk's future at the industry's leading carmaker.

Following the judge's decision, Musk took to social media platform X, asserting, 'Shareholders should control company votes, not judges.' In response, Tesla announced its intention to appeal the ruling, arguing that McCormick has overridden the majority decision made by Tesla's shareholders.

As Tesla contemplates an appeal to the Delaware Supreme Court, which could take up to a year, the ruling underscores McCormick's firm stance on the legality of corporate votes after litigation begins. She criticized Tesla's board for attempting to reset the pay package negotiation and the misleading information presented in its proxy statement.

(With inputs from agencies.)