A Delaware judge voided Elon Musk’s $55 billion pay package at Tesla on January 30, 2024, following a shareholder’s challenge, deeming it excessive. This decision, if upheld through a likely appeal, could significantly impact Musk’s wealth. The ruling requires Tesla’s board to create a new proposal, leaving Musk’s fortune uncertain. Richard Tornetta’s shareholder lawsuit accused Musk and the board of wasting assets and unjust enrichment, with the judge finding flaws in the board’s consideration due to conflicts of interest. The judge questioned the necessity of Musk’s “historically unprecedented compensation plan,” emphasizing Musk’s significant ownership stake as ample motivation. This development may affect Musk’s standing as the world’s richest person, potentially reducing his net worth to $154.3 billion, making him the third-richest, according to Bloomberg. As of January 2, 2024, Musk’s net worth was estimated at $229 billion, though these figures could change pending the appeal’s outcome. This ruling comes five years after the initially approved pay package, which was the largest potential ever at that time, tying stock options to Tesla’s market capitalization. Tesla is now tasked with drafting a new compensation package for Musk.
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