A Delaware appeals court reversed a 2024 ruling, allowing Elon Musk to receive his contested $56 billion compensation from Tesla.
NEW YORK: A Delaware appeals court has cleared the way for Tesla CEO Elon Musk to receive his long-contested $56 billion pay package.
The Delaware Supreme Court’s decision on Friday reversed a pair of 2024 judgments by Chancellor Kathaleen McCormick of the state’s Court of Chancery.
McCormick had invalidated the 2018 compensation package, calling the approval process “deeply flawed” and saying the board was vulnerable to manipulation by the “paradigmatic ‘Superstar CEO’.”
A five-judge appeals panel determined that McCormick ruled improperly in ordering a full rescission of the award.
“It is undisputed that Musk fully performed under the 2018 grant, and Tesla and its stockholders were rewarded for his work,” the ruling stated.
The package was originally challenged in court by Tesla shareholder Richard Tornetta, who argued the award was excessive.
Though approved by a majority of shareholders, the 2018 package has been eclipsed by Musk’s more recent compensation plans.
Tesla’s board has consistently supported Musk, approving an interim award worth about $29 billion in August 2025.
Shareholders then easily approved a new performance-based package in November 2025 worth as much as $1 trillion. – AFP
