A US judge on Monday upheld her decision to reject Elon Musk’s massive $55.8 billion compensation package at Tesla, denying an attempt to restore the pay deal through a shareholder vote.

In a court filing, Chancellor Kathaleen McCormick of Delaware’s Court of Chancery ruled that Tesla’s attempt to ratify Musk’s compensation package through a June shareholder vote could not override her January decision striking down the package as excessive and unfair to shareholders. McCormick found multiple flaws in Tesla’s ratification attempt, including “material misstatements” in documents provided to shareholders about the effect of their vote. “The motion to revise is denied,” McCormick wrote.

en France Africa Middle East Americas Europe Asia-Pacific Home Americas US judge rejects Musk’s $55.8 billion Tesla pay deal – again Americas Billionaire Elon Musk missed out on a mammoth $55.8 billion pay deal at his electric vehicle company, Tesla, after Delaware judge Kathaleen McCormick on Monday stood by her January decision to annul the compensation package, qualifying it as excessive and unjust to Tesla investors despite a favourable June shareholder vote.

While acknowledging their calculation method was technically sound under Delaware law, which bases fees on the percentage of benefit achieved, McCormick ruled that such a large award would constitute an excessive windfall. Shareholders originally backed the Musk compensation plan in March 2018 that was specifically designed to reward the 53-year-old founder for Tesla’s significant growth. But in a lawsuit, Tornetta accused the defendants of failing in their duties when they authorized the pay plan and alleged that Musk dictated his terms to directors, who were not sufficiently independent from their star CEO.

He also accused Musk of “unjustified enrichment” and asked for the annulment of a pay program that helped make the entrepreneur the richest man in the world. During a trial in 2022, Musk countered that investors in Tesla were some of the “most sophisticated in the world” and able to keep tabs on his management

During a trial in 2022, Musk countered that investors in Tesla were some of the “most sophisticated in the world” and able to keep tabs on his management. He said Tesla had been the laughingstock of the auto industry, and it was only the massive success of the company’s Model 3 that turned things around. Musk insisted that he played no role in coming up with the package nor discussed his deal with the board members, some of them close friends, who ultimately signed off on it.

The Delaware Court of Chancery has been a pillar of US capitalism for more than a century and is the jurisdiction where roughly two-thirds of American Fortune 500 companies are registered.