Elon Musk's $100B Tesla Pay Package: Delaware Law Under Fire

Elon Musk, the CEO of Tesla, has had his $100 billion pay package denied by Delaware courts on two occasions. Now, one of the electric vehicle maker's law firms is seeking to change state law in response to these rulings.

Musk's compensation package, which was approved by Tesla's board of directors, was initially challenged by a group of shareholders who argued that it was excessive and not in the best interests of the company. The Delaware Court of Chancery, which has jurisdiction over corporate disputes in the state, agreed with the shareholders and ruled that the package was invalid.

The Delaware Supreme Court later upheld this ruling, rejecting Tesla's appeal. In response, one of Tesla's law firms has proposed changes to Delaware's corporate law that would make it more difficult for shareholders to challenge executive compensation packages.

Musk has been critical of the Delaware courts' rulings, arguing that they are out of touch with the realities of the modern business world. He has also suggested that the courts are biased against him and Tesla, and that their rulings are politically motivated.

Tesla's law firm has not yet submitted a formal proposal to change Delaware's corporate law, but it is expected to do so in the near future. It remains to be seen whether the proposed changes will be adopted by the state legislature.

This is not the first time that Musk has clashed with Delaware's courts. In 2018, he was forced to step down as chairman of Tesla's board of directors after reaching a settlement with the Securities and Exchange Commission over allegations of securities fraud. The settlement required Musk to pay a $20 million fine and step down as chairman, but he was allowed to remain as CEO.

Musk has since criticized the settlement as unfair and politically motivated, and has suggested that he may seek to challenge it in court. However, it is unclear whether he will follow through on this threat.

Tesla has had a tumultuous relationship with Delaware's courts in recent years, and it remains to be seen how the proposed changes to state law will play out. However, it is clear that Musk and Tesla are determined to challenge the status quo and push for changes that they believe will benefit the company and its shareholders.