Musk Makes a Move After Judge Voids $55B Pay Package

UPDATE Feb 11, 2024 11:15 AM CST

Neuralink, Elon Musk's brain implant company, has shifted its legal corporate home from Delaware to Nevada—after his major Tesla pay package hit a wall in a Delaware court. Court records in both states show Neuralink, though it has its physical headquarters in Fremont, California, became a Nevada company on Thursday, the AP reports. The Nevada documents list Musk, who co-founded the company, as president of the privately held Neuralink. No one at the company issued an immediate comment on the change.

Jan 30, 2024 5:36 PM CST

"Never incorporate your company in the state of Delaware," Elon Musk said in a post on X Tuesday after a Delaware Chancery Court judge voided a Tesla compensation package potentially worth around $55 billion. Judge Kathaleen McCormick, ruling in a shareholder lawsuit, said Tesla's board of directors failed to prove that the CEO compensation plan was "fair," CNBC reports. The package was approved by shareholders in a 2018 vote, but McCormick said the process was "deeply flawed." The shareholder lawsuit argued that Musk himself controlled Tesla and dictated the pay package and it received approval from directors who were not independent of him, reports the AP.

McCormick said a company statement "inaccurately described key directors as independent and misleadingly omitted details about the process," meaning the shareholder vote was not "fully informed," the Verge reports. The pay package, which included incentives to hit milestones, was the largest in corporate history and it helped make Musk the richest person on the planet. Musk had "extensive ties with the persons tasked with negotiating on Tesla's behalf," and he launched "a self-driving process, recalibrating the speed and direction along the way as he saw fit," the judge wrote.

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The judge told the parties involved to "confer on a form of final order implementing this decision." The New York Times notes that the lawsuit, filed five years ago, took on "added significance" when Musk acquired Twitter in 2022. The pay package had been billed as a way of keeping Musk focused on Tesla, but its share price slumped as he appeared to be distracted by his new acquisition. (More Elon Musk stories.)