A Court Battle with High Stakes
Last month, Chancellor Kathaleen St. J. McCormick not only approved the settlement but also granted a $176.16 million legal fee award to three firms that led the lawsuit:
- McCarter & English LLP
- Fields Kupka & Shukurov LLP
- Bleichmar Fonti & Auld LLP
In addition, the lead plaintiff—a public pension fund in Detroit—received a $50,000 incentive award.
The settlement applied to both current and former board members, including:
- Kimbal Musk (Elon Musk’s brother)
- James Murdoch (media mogul)
- Robyn Denholm (Tesla board chair)
- Larry Ellison (Oracle co-founder)
Tesla’s latest appeal means the battle is far from over.
Tesla’s Legal Woes Extend Beyond the Boardroom
This case is just one of Tesla’s many high-stakes legal disputes. The company is also fighting a separate lawsuit over Elon Musk’s $56 billion, 10-year pay package, which was struck down by Chancellor McCormick in January 2024.
McCormick’s ruling, issued after a weeklong trial in November 2022, called Musk’s compensation plan “the largest in public market history” and pointed to conflicted board members and inadequate disclosures as reasons to void the package.
Musk, furious with the decision, immediately took to X (formerly Twitter) to declare:
“Never incorporate your company in the state of Delaware.”
Tesla soon after relocated its corporate headquarters to Texas and put a new pay package for Musk to a shareholder vote, which most investors approved.
