Elon Musk gets a win in the long-running legal battle over his Tesla pay

By Emily Bary

A Delaware judge previously rejected the 2018 package, but Friday's ruling said it would have been unfair for Musk to have been left uncompensated for years of work

Elon Musk took a victory lap on X after his Tesla pay package was cleared by a court.

Tesla CEO Elon Musk's 2018 pay package, the subject of much controversy over the years, must be reinstated, a Delaware court ruled on Friday.

The Delaware Chancery Court twice invalidated Musk's 2018 options package, which consisted of 12 tranches set to vest after Tesla (TSLA) hit various milestones around its market capitalization and business. The prior legal rejections came even though shareholders had voted to approve the pay, as that judge said Musk had undue influence over the company's board of directors.

Following an appeal, a Delaware Supreme Court judge has now said that the prior rejections were too harsh, citing various legal points. For one, a cancellation of the approved pay package would have left Musk "uncompensated for his time and efforts over a period of six years," the new ruling said. The court further noted that it was "undisputed that Musk fully performed under the 2018 grant," delivering for shareholders.

The Tesla CEO was awarded $1 in nominal damages on Friday, in addition to the reinstatement of his package.

See also: Tesla investors approve Elon Musk's $1 trillion pay package - but the money won't come easy

Tesla said in a statement a year ago that a rejection of the package would mean "judges and plaintiffs' lawyers run Delaware companies rather than their rightful owners - the shareholders."

Musk himself weighed on X following Friday's ruling.

Shareholders have since approved a new record pay package for Musk, which could turn him into a trillionaire provided that he can achieve ambitious milestones for the company. For instance, Tesla would need to command a $8.5 trillion market capitalization - compared to today's $1.5 trillion market cap - for Musk to get the full pay. He also needs to come up with a succession plan.

See more: Here's what Elon Musk must do to become a Tesla trillionaire

-Emily Bary

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12-19-25 1728ET