Elon Musk wins US court appeal of $56bn Tesla pay package
Elon Musk has won a major U.S. court appeal that restores his long-contested $56 billion 2018 Tesla pay package, with the Delaware Supreme Court overturning a lower court’s decision that had previously struck it down. The ruling clears the way for Musk to receive the compensation package after years of legal battles and uncertainty over its validity.
The dispute began after Tesla shareholders approved the 2018 compensation plan, which granted Musk stock options worth about $56 billion at the time and tied to ambitious company performance targets. A shareholder lawsuit challenged the package as excessive, and in early 2024 Delaware’s Court of Chancery rescinded the award, calling the process flawed due to conflicts of interest on Tesla’s board. The company appealed that decision to the Delaware Supreme Court.
In its latest ruling, the Supreme Court reversed the lower court’s rescission remedy, saying it was improper and inequitable to leave Musk without compensation for his work over many years and highlighted that Musk and Tesla stockholders were rewarded by the company’s significant growth. The court’s judgment also noted that Tesla fulfilled the milestones tied to the compensation package, supporting the view that Musk earned the award.
Based on Tesla’s current stock price, the reinstated 2018 package is now worth far more than its original $56 billion valuation, possibly exceeding $100 billion, reflecting how much the share price has risen since the plan was approved. The ruling not only vindicates Musk’s legal position but also reinforces his influence over Tesla as it continues to pursue ambitious growth targets.
The decision also comes amid broader changes in corporate governance and legal strategy, as Tesla had already approved a new compensation plan in late 2025 that could be worth even more if performance targets are met. Musk called the court ruling a vindication of his contributions to Tesla’s success.
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