In 2024, a coalition of Tesla shareholders urged investors to reject a renewed vote on Elon Musk’s 2018 CEO Performance Award, often described at the time as a $56 billion pay package. The opponents said the board’s process and oversight were flawed, pointing to a Delaware court ruling that ordered the award rescinded. Tesla asked shareholders to ratify the award again. The vote showed substantial support, but it did not resolve the separate court challenge.
Who urged Tesla shareholders to vote against the award?
A shareholder coalition that included SOC Investment Group, New York City Comptroller Brad Lander and Amalgamated Bank campaigned against ratifying Musk’s 2018 award. The coalition also urged shareholders to vote against the reelection of directors Kimbal Musk and James Murdoch. Its May 2024 letter described the campaign as a response to the Delaware Court of Chancery’s January ruling and to what the coalition viewed as weaknesses in the board’s independence and oversight.
That was an advocacy position, not a consensus among Tesla investors. Materials later filed in the Delaware Supreme Court record said proxy advisers Institutional Shareholder Services (ISS) and Glass Lewis recommended voting against ratification, while other major shareholders said they would support it.
What were shareholders being asked to reject?
The proposal concerned Tesla’s 2018 CEO Performance Award, an options-based compensation package for Musk. After the Delaware Court of Chancery ordered the award rescinded in a January 30, 2024 opinion, Tesla’s 2024 proxy asked shareholders to ratify the award again and argued that the court’s ruling should be revised. The shareholder coalition urged investors to vote against that renewed ratification proposal.
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Tesla’s annual meeting was scheduled for June 13, 2024. The “$56 billion” label refers to how the award was widely described in the dispute; the materials cited here do not establish a single, current valuation for it.
Why did opponents object, and how did Tesla respond?
| Position | Main argument |
|---|---|
| Shareholder coalition | The coalition argued that the board’s process for seeking another shareholder vote did not adequately address the court’s concerns, and challenged the board’s independence and oversight. Associated Press coverage also summarized opponents’ concerns about the award’s size and Musk’s divided attention. |
| Tesla | Tesla’s proxy asked shareholders to ratify the award again and said the prior ruling should be revised. As AP reported, Tesla chair Robyn Denholm defended the award by pointing to the company’s performance targets and shareholder returns. |
| Proxy advisers and other major investors | ISS and Glass Lewis recommended voting against ratification, while other major shareholders publicly indicated support, according to materials filed in the Delaware Supreme Court record. |
AP reported that the coalition described the award as having an “excessiveness problem.” That characterization belongs to the opponents; Tesla’s defense relied on its account of the award’s performance targets and the company’s returns.
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What happened in the 2024 vote?
Tesla’s 2025 Form 10-Q reported that 72% of disinterested voting shares supported ratification at the 2024 annual meeting. This figure describes the vote among disinterested shares, not every share or every investor. It also answers only the shareholder-approval question: a vote to ratify the award did not itself overturn the Chancery Court’s ruling or determine the outcome of the appeal.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What legal status did Tesla report afterward?
In its Form 10-Q for the quarter ended June 30, 2025, Tesla said the Chancery Court denied the motion to revise its January 2024 opinion on December 2, 2024, and awarded plaintiff’s counsel $345 million. Tesla and the director defendants appealed. Tesla reported that briefing was complete and no oral-argument date had been set as of that filing.
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Those are the procedural developments Tesla reported in that filing; they do not establish what the Delaware Supreme Court ultimately decided afterward.
What interim compensation did Tesla announce?
In a separate 2025 SEC-filed letter, Tesla said its board had approved an interim award to Musk of 96 million restricted shares. Tesla described a two-year vesting period, a purchase price of $23.34 per share and a requirement that Musk remain in a senior leadership role throughout vesting.
Tesla said the arrangement was designed to prevent Musk from retaining both the full 2018 award and the interim award. If the Delaware courts fully reinstated the 2018 award, Tesla said the interim shares would be forfeited or returned, or some portion of the 2018 award would be forfeited. The letter describes Tesla’s announced terms, not a final court disposition.
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