DELAWARE (Reuters) – The Delaware judge who overturned Elon Musk’s record pay package at Tesla (NASDAQ:) has told parties in the case that she is confident the electric vehicle maker will not use an upcoming shareholder vote to criticize her decision.
WHY IS IT IMPORTANT
The shareholder legal team that filed a lawsuit over Musk’s $56 billion payday has asked Chancellor Kathleen McCormick (NYSE:) for orders to prevent their case from being overturned in a Texas court.
The company’s shareholders will vote next month to “ratify” the pay package that McCormick rescinded and to reunite Tesla in Texas.
CONTEXT
The shareholder’s legal team said in an April court filing that Tesla and Musk could try to overturn McCormick’s decision in another jurisdiction, such as Texas.
Tesla called it “high-profile speculation” in court papers and said Delaware would retain jurisdiction over the wage dispute. McCormick took the statement as an assurance that the company would not try to circumvent its previous decision.
KEY QUOTE
“If I have misunderstood the defendant’s position, it is the responsibility of the defense attorneys – as officers of the court – to correct it. In the meantime, the defendant’s statements bring me great comfort,” McCormick said in her seven-page book. letter.
WHAT’S NEXT
Tesla shareholders will vote on June 13 to decide whether they want to continue taking Musk’s salary and reincorporate the company in Texas, where it is headquartered, from Delaware, where most large public companies have their legal home.
McCormick must decide whether the shareholder’s legal team should receive Tesla’s $6 billion in fees before Musk and Tesla can appeal. She set a hearing on legal costs for July 8.
ANSWER
Greg Varallo, an attorney for shareholder Richard Tornetta, declined to comment.
Lawyers for the company did not immediately respond to requests for comment.