Judge Says No to Elon Musk’s $55.8 Billion Pay: A judge in the U.S. has again said no to Elon Musk’s $55.8 billion paycheck from Tesla. She also stopped Tesla from trying to bring the deal back by letting shareholders vote on it.
Judge Kathaleen McCormick, who works in Delaware’s special business court, said the vote couldn’t change her earlier decision. Back in January, she said the pay deal was too much money and unfair to people who own Tesla shares. She also said Tesla gave wrong information to shareholders before the vote.
“The motion to revise is denied,” McCormick said. She explained that Tesla’s lawyers tried some clever ideas to save the deal, but those ideas went against the law.
Lawyers Get Smaller Fee
The judge decided Tesla would have to pay $345 million to the lawyers of Richard Tornetta, a Tesla shareholder who complained about the pay deal. But this is much less than the $5.6 billion the lawyers wanted. The judge said their request was way too big.
What Happened in the First Place
In 2018, Tesla shareholders agreed to the big pay deal for Musk. The deal was supposed to reward him for helping Tesla grow. But Tornetta said it wasn’t fair. He said Musk made the deal himself and that Tesla’s board didn’t stop him because they were too close to him. He also said Musk got too much money and asked the court to cancel the pay.
What Musk Said
In 2022, Musk told the court he didn’t make the deal or talk about it with the board. He also said Tesla was having a hard time back then, and the Model 3 car saved the company. He said Tesla’s investors are smart and would speak up if they thought the pay deal was bad.
A Court That Handles Big Business
The Delaware Court of Chancery, where this happened, is known for solving big business problems. Many big companies, like Tesla, are set up in Delaware, so this court has a lot of power over business fights.
