Posted by Sam Fenny - Memes and headline comments by David Icke Posted on 31 January 2024

Elon Musk risks losing status as world’s richest man after Tesla pay deal ruled unlawful

Elon Musk risks losing his spot as the world’s richest man after a US judge ruled the billionaire’s “unfathomable” $56bn (£44bn) Tesla pay package unlawful.

During a Delaware court ruling on Tuesday, Judge Kathaleen McCormick said the pay package, awarded in 2018, did not meet the standard of a “fair price”.

In her ruling, Ms McCormick wrote: “The incredible size of the biggest compensation plan ever – an unfathomable sum – seems to have been calibrated to help Musk achieve what he believed would make ‘a good future for humanity’.”

The judgement can be appealed to Delaware’s Supreme Court.

If the ruling is upheld, Mr Musk would drop two places in the rankings of the world’s richest people, below Bernard Arnault, the owner of French luxury giant LVMH, and Jeff Bezos, the Amazon founder. It will leave Mr Musk with a net worth of around $155bn.
Mr Musk’s pay award from Tesla is by far the largest ever for any executive and has provided a large part of his vast wealth.

Tesla’s directors had argued the deal had kept Mr Musk focused on the electric vehicle company. Antonio Gracias, a former Tesla director, said it was “a great deal for shareholders” because Mr Musk had enabled the company’s success.

The pay deal granted Mr Musk the right to buy batches of Tesla stock at a steep discount to its current share price if financial targets were met.

But a Tesla shareholder, Richard Tornetta, challenged the pay deal, with lawyers arguing Mr Musk’s goals were easier to achieve than the board had originally told shareholders. Mr Tornetta’s lawyers also claimed company forecasts showed Mr Musk would quickly qualify for a large part of the award.

They added that Mr Musk should have been working full time at Tesla – rather than splitting his time with SpaceX and other ventures – and the board had a duty to offer a less lucrative deal or seek another chief executive.

On Twitter, Mr Musk lashed out at the ruling and threatened to move Tesla’s legal incorporation out of the state.

“Never incorporate your company in the state of Delaware,” Mr Musk said. “I recommend incorporating in Nevada or Texas if you prefer shareholders to decide matters.”

The billionaire then posted a poll asking his followers if Tesla should move its legal base to Texas. Tesla’s shares fell 2pc in after-hours trading.

Tesla’s valuation surged to more than $1 trillion in 2021, compared to $50bn when the package was agreed. It is now worth around $600bn.

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