Overview

• Delaware Chancery Court Judge Kathaleen McCormick has upheld her January ruling invalidating Elon Musk's 2018 Tesla pay package, valued at $56 billion when approved.
• The judge cited conflicts of interest among Tesla's board members and insufficient disclosure to shareholders as key reasons for the decision.
• Tesla shareholders overwhelmingly voted in June to ratify the pay package, but McCormick ruled that a post-ruling shareholder vote cannot retroactively resolve legal issues.
• Tesla plans to appeal the decision, with analysts predicting the case could escalate to the Delaware Supreme Court or even federal courts.
• The ruling has sparked broader discussions about corporate governance, shareholder rights, and the potential for companies to relocate their incorporation from Delaware to other states like Texas.