The Delaware Supreme Court rules in favour of Musk and his $56bn compensation package.By ReutersPublished On 19 Dec 202519 Dec 2025Click here to share on social mediashare2ShareElon Musk’s 2018 pay package from Tesla, once worth $56bn, has been restored by the Delaware Supreme Court, in the United States, two years after a lower court struck down the compensation deal as “unfathomable”.Friday’s ruling overturns a decision that had prompted a furious backlash from Musk and damaged Delaware’s business-friendly reputation.Recommended Stories list of 4 itemsend of listThe pay package was by far the largest ever, until Tesla shareholders approved a new, even larger pay plan of nearly $1 trillion in November.The ruling means that Musk can finally get paid for his work since 2018, when he transformed Tesla from a struggling startup to one of the world’s most valuable companies.The 2018 pay deal provided Musk options to acquire about 304 million Tesla shares at a deeply discounted price if the company hit various milestones, which it did.Tesla estimated in 2018 that the plan was potentially worth $56bn, although given the rise in the stock price, the value ballooned to about $120bn by early November. The options represent approximately 9 percent of Tesla’s outstanding stock.Musk never collected his stock options because, soon after shareholders approved the 2018 compensation, the board was sued by Richard Tornetta, an investor with just nine Tesla shares.In 2024, after a five-day trial, Delaware Judge Kathaleen McCormick concluded that Tesla’s directors were conflicted and key facts were hidden from shareholders when they voted to approve the plan. She ordered that the 2018 plan be rescinded.Musk accused Delaware judges of being activists, hostile to tech founders, and he urged businesses to follow Tesla and reincorporate elsewhere. Advertisement Dropbox, Roblox, The Trade Desk and Coinbase were among the handful of large companies that moved their legal homes to Nevada or Texas. However, Delaware remains by far the most popular legal home for US public companies.Tesla’s board has warned that Musk, the world’s richest person who also leads the SpaceX rocket venture and the …
