A Delaware judge voided Tesla CEO Elon Musk’s eye-popping $55.8 billion pay package from Tesla on Tuesday, according to a filing, potentially delivering a hit to the tech billionaire’s wealth after a shareholder argued the package was excessive.
Musk's net worth is an estimated $210.6 billion. (Photo by Beata Zawrzel/NurPhoto via Getty Images)
The ruling, which can be appealed, means that Tesla’s board will have to start from scratch on a new pay proposal for Musk—the wealthiest man in the world.
Tesla shareholder Richard Tornetta argued Tesla’s board breached its fiduciary duties by awarding Musk the performance-based plan, which was “the largest potential compensation opportunity ever observed in public markets,” according to the filing.
The judge, Kathaleen McCormick, said in her ruling that Tornetta and Tesla will have to discuss a “form of final order” implementing the decision and submit a joint letter that identifies all issues that “need to be addressed to bring this matter to a conclusion at the trial level.”
Tesla shares closed Tuesday at $191.59 and have dropped more than 3% in after-hours trading as of 5:30 p.m.
Tesla didn’t immediately respond to Forbes’ request for comment.
This is a developing story. Check back for updates.