Elon Musk was expected to receive a salary package worth $56 billion.
This ruling comes after Tesla shareholder Richard Tornetta went to court in Delaware claiming that Musk was overpaid.
Judge Kathleen McCormick came to the conclusion that the salary package – which equates to more than NOK 580 billion at today's exchange rate – is an unimaginable and unfair sum to the electric car manufacturer's shareholders.
– It's a good day for good people, Tornita's lawyer Greg Varallo wrote in an email to AFP.
– Never incorporate your company in Delaware, Musk himself wrote on X/Twitter after the court decision.
Tesla shares fell 3% when the 200-page ruling was announced.
Judge McCormick says she handled the case with urgency to protect the company and shareholders from harmful uncertainty.
The process that preceded the approval of Musk's salary package was characterized by many errors. Musk had close relationships with those who were supposed to negotiate on Tesla's behalf, she wrote in the ruling, among other things.
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