Delaware Judge Kathaleen McCormick has denied a motion to revise her ruling that rescinded Tesla Inc (NASDAQ:TSLA) boss Elon Musk’s 2018 compensation package worth nearly $56 billion.
The court found that the defendants, named as Musk and other Tesla execs, lacked the procedural grounds to change a prior decision.
Tesla stockholder Richard Tornetta successfully sought to block the compensation package through a court action this January.
Tornetta alleged that the gigantic compensation package granted to Musk breached fiduciary duties owed to the company and its shareholders.
The exorbitant compensation package was structured as 12 tranches of stock options.
Each completed tranche granted Musk options to purchase shares equal to 1% of Tesla’s outstanding common stock as of January 19, 2018.
It would have allowed Musk to purchase over 300 million Tesla shares at $23.33 against an actual market price of $357 each (as of 2 December, 2024).
The estimated value of the award was disclosed as $55.8 billion.
McCormick’s first decision to block the compensation package was met with outrage by Musk, who swiftly moved Tesla’s legal headquarters from Delaware to Texas in protest.
He also urged other companies to move their incorporation out of Delaware.
Sending this cake to Delaware as a parting gift ???? pic.twitter.com/uLKE7LDSCW
— Elon Musk (@elonmusk) June 14, 2024
Musk has yet to comment on the latest ruling.