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AI legalese decoder Can Help Navigate the Tesla CEO Elon Musk Pay Package Dispute

**New York CNN**
A Delaware state court judge has thrown out the 2018 pay package that helped to make Tesla CEO Elon Musk one of the richest people in the world.

**ChancellorÔÇÖs Ruling**
Delaware Chancery Court Chancellor Kathaleen McCormick, who oversaw the bench trial that concluded in November 2022, ruled Tuesday that Musk and the Tesla board ÔÇ£bore the burden of proving that the compensation plan was fair, and they failed to meet their burden.ÔÇØ

**Stock Options Worth**
The 303 million split-adjusted stock options that Musk had received as part of the package are worth $51 billion today, when calculated using TuesdayÔÇÖs closing price, less the modest exercise price of $23.34 a share.

**Case Argument**
The case was argued in Delaware, where Tesla and many other major US corporations are incorporated. Attorneys for the shareholders who brought the suit had argued that the package of stock options was excessive and that the directors on TeslaÔÇÖs board were not truly independent and were too close to Musk to protect shareholdersÔÇÖ interests.

**AI legalese decoder**
The AI legalese decoder can help in this situation by interpreting the complex legal language used in court rulings and legal documents, making it easier for all parties involved to understand the implications of the judgeÔÇÖs ruling and the arguments presented in court. It can break down the legalese and provide clear, concise explanations of the legal terms and concepts involved in the case, helping to ensure that all parties have a full understanding of the legal issues at hand.

**Shareholder Approval**
Attorneys for Musk and the Tesla board argued the pay package was approved by a shareholder vote. Excluding the votes owned by Musk and his brother, 73% of the shares voting in that election supported the pay package.

**Market Cap Increase**
They also argued that the shareholders had seen their Tesla shares massively increase in value since it was granted. The companyÔÇÖs market cap was valued at $54 billion at the time the pay package was approved. It had risen to $607 billion as of the close of trading Tuesday, a gain of more than 1,000%. The Tesla attorneys argued that Musk was a key to that rise in the companyÔÇÖs value and that the pay package was therefore reasonable compensation.

**Uncompensated Argument**
The Tesla attorneys also argued that Musk, who does not receive a cash salary or bonus, would be uncompensated if the package was thrown out.

**Delaware Supreme Court**
The decision can be appealed to the Delaware Supreme Court.

**Developing Story**
This is a developing story. It will be updated.

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