Elon Musk Criticizes Delaware Judge Over $100 Billion Pay Package Ruling

Elon Musk has strongly criticized a Delaware judge for ruling against his $100 billion pay package, describing the decision as "totally crazy" and labeling it as "absolute corruption." Musk expressed his frustration on the social media platform X following the ruling made by Court of Chancery Judge Kathleen McCormick.

Judge McCormick, who was appointed by Delaware’s Democratic Governor John Carney, upheld a prior decision that deemed Musk's pay package excessive and stated that it was improperly influenced by him during negotiations with Tesla's board of directors.

In June, over 70% of Tesla's shareholders voted in favor of reinstating Musk’s compensation at the company’s annual meeting. However, the ruling from Judge McCormick disregarded this majority support. She maintained that the arguments presented by Tesla’s legal team regarding shareholder ratification did not align with established legal precedents.

This ruling comes after Tesla’s decision to reincorporate in Texas earlier this year, although Musk's lawyers assured that the Delaware court would still hold jurisdiction over any compensation disputes.

Tesla has announced that it plans to appeal the ruling. Analyst Dan Ives from Wedbush has expressed confidence that Tesla will ultimately prevail, suggesting that Musk will receive his pay package in the end.

Many Tesla supporters and business figures have voiced their discontent with the judge’s ruling. Cathie Wood, CEO of ARK Invest and a notable Tesla shareholder, criticized Judge McCormick, stating that the judge overstepped by determining CEO compensation despite overwhelming shareholder approval. Paul Graham from Y Combinator also chimed in, warning that if judges begin overruling shareholders, companies might reconsider incorporating in Delaware.

Overall, Musk and other business advocates are standing firmly against what they see as judicial overreach, marking this event as a significant moment in corporate governance and shareholder rights.

Musk, Tesla, Judiciary