Musk’s multibillion-dollar Tesla pay package again rejected by US judge

Judge says Tesla’s ‘unprecedented theories’ do not support argument to reverse previous ruling scrapping pay deal.

A judge in the United States has upheld a decision to deny Tesla CEO Elon Musk a multibillion-dollar pay package despite shareholders voting to restore the compensation deal.

The decision by a Delaware judge on Monday reaffirmed an earlier ruling to void the pay deal on the basis that Tesla’s board was too close to Musk and had not sufficiently protected shareholders’ interests.

Chancellor Kathaleen St Jude McCormick of Delaware’s Court of Chancery found that there was no legal precedent to reverse her earlier ruling and that if courts condoned “the practice of allowing defeated parties to create new facts for the purpose of revising judgments, lawsuits would become interminable”.

“The large and talented group of defense firms got creative with the ratification argument, but their unprecedented theories go against multiple strains of settled law,” McCormick wrote in a 103-page opinion.

McCormick also found that Tesla had made “material misstatements” to shareholders about the effect of their vote to reinstate Musk’s pay deal.