Despite a vote by Tesla shareholders in June 2024, in favor of Elon Musk's exceptional compensation, the Delaware judge once again ruled against this December 2.
It's still a failure: Elon Musk will still not be able to receive the $56 billion salary planned for his performance at the head of the car manufacturer Tesla. However, he thought he had found a solution to this legal dispute by organizing a new vote on June 13, 2024 among Tesla shareholders.
Certainly, Tesla shareholders voted by majority for Elon Musk's astronomical compensation plan. However, the courts ruled against him again, as Reuters reported on December 3. Elon Musk is fuming and plans to appeal the case to the Supreme Court.
Tesla gets along with the rules, which the judges don't like
After the judge's first refusal in January, Elon Musk considered that the court's decision was only political. He then did everything possible to find a solution. The idea was therefore to reorganize a vote among the shareholders to prove to the judge that they are indeed in favor of the exceptional remuneration.
The Tesla boss also took advantage of this general meeting to vote for the move of Tesla's headquarters from the state of Delaware, where the case was judged, to Texas, which he considers a more favorable state for his activity.
A few weeks before the vote, Tesla took significant steps to ensure that as many shareholders as possible would vote, and that they would vote in favor of the compensation plan. Advertising, lobbying, emotional blackmail, everything was done to get shareholders to support Elon Musk. It worked, although the majority in favor was smaller than a few years ago.
Tesla's legal team believed the new vote would validate the exceptional compensation and force the judge to reconsider her decision to overturn the compensation plan. She thus thought she could circumvent the law, by proving that the judge was on the wrong track. It was awkward, because the arguments which led to the initial cancellation of the 56 billion remained valid. Even with forceps, the argument did not pass, the judge even having clarified: “ Even if the shareholder vote could have ratifying effect, it could not do so here due to multiple material inaccuracies in the proxy statement. »
In addition, the judge ordered Tesla to pay $345 million to the lawyers who brought the case to court. Tesla must therefore go to the cash register and once again review its copy before hoping to appeal to the Supreme Court of Delaware.
Elon Musk insists on seeing it as a political conspiracy
Following the decision, Elon Musk tweeted: “ Shareholders should control corporate votes, not judges. »
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As is often the case, the businessman wants to play by his rules and hates when he is reminded that the rules are the same for everyone. Even when you're the richest man in the world, things don't always go as you hope. His supporters, who had already stepped up after the decision in January, are once again criticizing the decision. Everyone fears seeing Elon Musk leave Tesla. But, isn't that already the case now that Elon Musk has accepted a position in the Trump administration?
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