Elon Musk’s astronomical compensation package has hit another roadblock in U.S. courts.
On Monday, Delaware court judge Kathleen McCormick reaffirmed a ruling that deemed Musk’s $56 billion compensation plan inappropriate. With Tesla’s recent stock surge, the current value of this compensation package has skyrocketed to $101.5 billion.
During a June shareholders ‘ meeting, the court rejected Tesla’s move to reauthorize Musk’s bonus payment. Judge McCormick dismissed Musk’s arguments, stating that even if the shareholders’ vote had legitimized the compensation plan, it did not apply.
This ruling aligns with the growing controversy over excessive CEO compensation. In 2023, Apple CEO Tim Cook faced shareholder backlash over his $99 million compensation, while Disney Chairman Bob Iger was also criticized for receiving excessive payouts.
Tesla announced its intention to appeal the ruling immediately, expressing strong dissatisfaction with the court’s decision through X. The company stated that the ruling was incorrect. Experts predict that the outcome of this lawsuit will significantly impact corporate governance and executive compensation systems in the future.
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