Delaware Confiscates $100 Billion of Musk’s Wealth
Monday, 02 December 2024 10:42 PM EST
A Delaware judge moved Monday to confirm its confiscation of Elon Musk's wealth that he created at Tesla — denying him a compensation package that would be worth over $100 billion in value today.
Musk has paid a heavy price for countering woke politics, making X a neutral platform, and backing Donald Trump for president.
Delaware Chancellor Judge Kathaleen McCormick on Monday ruled to confirm her January ruling that found Musk was not eligible for a 2018 compensation package then valued at $56 billion.
McCormick complained the Tesla package for Musk was the "biggest compensation plan ever — an unfathomable sum."
After McCormick had initially ruled that Musk had not gotten proper approval from Tesla shareholders, Musk filed suit.
Musk said he properly received board approval and later hit financial targets to earn the compensation, including benchmarks based on stock value, profitability, and revenue.
At one point, visionary Musk had driven the value of Tesla to close a trillion dollars during the compensation period. Today, Tesla holds a market cap of over $1.1 trillion.
After the judge's January 2024 ruling, Tesla went back to its shareholders to approve the Musk compensation plan.
In June, Tesla shareholders again approved the original $56 billion compensation overwhelmingly — with 77% of stock owners backing Musk and the package.
After the shareholder vote, Tesla went back to the Delaware court to seek its approval, only to find its compensation plan rebuffed again.
"Even if a stockholder vote could have a ratifying effect, it could not do so here," McCormick said in her opinion Monday.
"Were the court to condone the practice of allowing defeated parties to create new facts for the purpose of revising judgments, lawsuits would become interminable," she wrote.
McCormick saw little contradiction, however, in penalizing Musk for the wealth he created, while granting the lawyers who sued him on behalf of shareholders an incredible $345 million in attorney fees for their legal filings.
Musk was not happy by today's ruling and took to X writing, "Shareholders should control company votes, not judges."
Musk reposted other X posts critical of the ruling.
One repost stated: "Things to do in Delaware: 1) Leave."
Musk also reported fund manager Cathie Wood's X post where she called McCormick an "activist judge at its worst."
Wood continued: "No judge has the right to determine CEO compensation. Shareholders voted twice, overwhelming each time, to ratify @elonmusk's 2018 performance-based pay package."
Since the court's first ruling, Musk has been on the warpath with Delaware.
This year he moved both Tesla and SpaceX's incorporation from Delaware to Texas. He also moved Neuralink to Nevada.
Musk has also urged other companies to quit Delaware as well.
On X, Musk has stated bluntly, "Never incorporate your company in the state of Delaware."
The home state of President Joe Biden, Delaware has come under criticism for its close ties to the Biden family and its political agenda.
Last year, The Wall Street Journal published an article, co-authored by former Attorney General William Barr, lambasting Delaware for embracing far-left Environmental, Social, and Governance policies and attempting to push them on corporations.
And The Hill reported that major corporations are fleeing Delaware as a result of its highly politicized agenda.
Data suggests Delaware is seeing a drop-off of new incorporations. In 2022, the last year the state released data, Delaware saw a 6% fall in new incorporations.
