Musk's $56 billion Tesla pay package must be restored as court rules cancellation was too extreme
Source: CNBC
Published Fri, Dec 19 2025 4:24 PM EST Updated 5 Min Ago
Elon Musk’s 2018 CEO pay package from Tesla, worth some $56 billion when it vested, must be restored, the Delaware Supreme Court ruled Friday. “We reverse the Court of Chancery’s rescission remedy and award $1 in nominal damages,” the judges wrote in their opinion.
In the decision, the Delaware Supreme Court judges said a lower court’s decision to cancel Musk’s 2018 pay plan was too extreme a remedy, and that lower court did not give Tesla a chance to say what a fair compensation ought to be.
The decision on the appeal in this case, known as Tornetta v. Musk, likely ends the years-long fight over Musk’s record-setting compensation. Musk’s net worth is currently estimated at around $679.4 billion, according to the Forbes Real Time Billionaires List.
Dorothy Lund, a professor at Columbia Law School, told CNBC that while the Friday opinion may restore the 2018 pay plan for Musk, it leaves the rest of the lower court’s decision unaddressed and in-tact.
Read more: https://www.cnbc.com/2025/12/19/musk-tesla-pay-delaware-supreme-court.html
Link to RULING (PDF) - https://courts.delaware.gov/Opinions/Download.aspx?id389200
Article updated.
Previous article/headline -
Published Fri, Dec 19 2025 4:24 PM EST Updated 23 Min Ago
Elon Musk's 2018 CEO pay package from Tesla , worth some $56 billion when it vested, must be restored, the Delaware Supreme Court ruled Friday. "We reverse the Court of Chancery's rescission remedy and award $1 in nominal damages," the judges wrote in their opinion.
In the decision out Friday, the Delaware Supreme Court judges said a lower court's decision to rescind Musk's 2018 pay plan was too extreme a remedy, and the lower court did not give Tesla a chance to say what a fair compensation ought to be.
The decision on the appeal in this case, known as Tornetta v. Musk, likely ends the years-long fight over Musk's record-setting compensation.
Musk's 2018 CEO pay package from Tesla, comprised of 12 milestone-based tranches of stock, was unprecedented at the time it was proposed. After it was granted, the pay plan made Musk the wealthiest individual in the world. A shareholder named Richard J. Tornetta sued, filing a derivative action in 2018, accusing Musk and the Tesla board of a breach of their fiduciary duties.
Original article -
Elon Musk's 2018 CEO pay package from Tesla, worth some $56 billion when it vested, must be restored, the Delaware Supreme Court ruled Friday. "We reverse the Court of Chancery's rescission remedy and award $1 in nominal damages," the judges wrote in their opinion.
In the decision on the appeal out Friday, the Delaware Supreme Court judges said a recision of Musk's 2018 pay plan was too extreme a remedy, and the court did not give Tesla a chance to say what a fair compensation ought to be.
The decision likely ends the years-long fight over Musk's record-setting compensation.
Musk's 2018 CEO pay package from Tesla, comprised of 12 milestone-based tranches of stock, was unprecedented at the time it was proposed. After it was granted, the pay plan made Musk the wealthiest individual in the world. A shareholder named Richard J. Tornetta sued, filing a derivative action in 2018, accusing Musk and the Tesla board of a breach of their fiduciary duties.