Elon Musk’s $139bn Tesla Pay Deal Reinstated After Delaware Supreme Court Ruling
The Delaware Supreme Court has reinstated a controversial pay package awarded to Tesla chief executive Elon Musk in 2018, ending a lengthy legal battle that had seen the deal struck down twice by a lower court.
The ruling restores Musk’s right to purchase about 303 million Tesla shares on a split-adjusted basis, a compensation package now valued at roughly $139bn (£110bn) based on the company’s latest share price.
The pay deal had previously been voided by Delaware Chancery Court Chancellor Kathaleen McCormick, who ruled that despite being approved twice by Tesla shareholders, the package was excessive and unfair. She said Tesla’s board had failed to demonstrate that the scale of the award was reasonable and in the best interests of shareholders.
Even after a second shareholder vote reaffirmed support for the compensation plan, the lower court rejected it again.
However, the state’s highest court overturned those decisions on Friday, saying the lower court had erred. In its judgment, the Delaware Supreme Court said scrapping the pay package was “inequitable” and effectively left Musk without compensation for years of work leading Tesla’s growth.
Musk, already the world’s richest person, has an estimated net worth of about $644bn, according to Bloomberg. Much of that wealth comes from his existing Tesla holdings, which amount to more than 400 million shares. Tesla’s stock is trading close to record highs reached earlier this week.
In addition to the reinstated 2018 deal, Musk has recently been approved for a new Tesla compensation package that could be worth up to $1tn if the company’s valuation meets ambitious future targets.
His fortune also extends beyond Tesla. Musk is the controlling shareholder of SpaceX, which is expected to go public as early as next year, a move that could further boost his wealth.
Reacting to the court decision, Musk thanked supporters in a brief post on X, calling the ruling a vindication after years of legal uncertainty.
