Tesla Asks Shareholders To Approve Musk’s ‘Unfathomable’ $46 Billion Compensation After Judge Rules Was Illegally Granted

On June 13, Tesla shareholders must decide whether Musk’s contribution is worth $46 billion.

In January, a judge ruled to strike down Musk’s compensation package, which was initially approved in 2018. The decision came after a shareholder filed a lawsuit against Tesla, arguing that Musk’s pay was excessive and dictated by himself through negotiations with board members. Though Musk denied involvement in determining the sum of his payment package, the court determined that Musk had conflicts of interest with board members due to their personal and financial connections to them.

Since Musk joined Tesla in 2018, the company’s value has risen from $50 billion to $570 billion. Tesla’s board members who support the compensation package believe that Musk’s leadership and innovation have been instrumental in this value increase, justifying the record-setting compensation.

Tesla has spent money on advertisements to convince investors to vote in favor of the pay package, even though they traditionally do not use advertisements of any kind.

“You deserve the final say on matters affecting your investment in Tesla,” Tesla posted on X. “Vote FOR the protection of stockholder rights and to preserve present and future value creation by supporting Tesla proposals 3 and 4.”

Despite these efforts, Musk still faces strong opposition. Billionaire Leo Koguan, Tesla’s biggest retail shareholder, publicly announced that he would vote against the pay package.

“Tesla is a family business masquerading as a public company to benefit only one person with his few friends and family,” Koguan told Electrek.

Tesla was able to call for a revote through a little-known section of Delaware’s law that allows companies to fix procedural flaws that can void boardroom decisions. To address the conflicts of interest within the board, the company asked an independent director to review the 2018 compensation deal to determine whether the board granted the package in the best interests of investors. After reviewing the Delaware judge’s findings, shareholders will vote to approve or reject Musk’s payment package.

Musk has faced numerous problems with his businesses in the last year. Since Musk acquired Twitter, the company, now called X, has lost 71% of its value.