• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

Surging Treasury yields expose a brutal truth: America has no margin for error on its $39 trillion debt

2

U.S. says deals with Iran for safe Hormuz transit are prohibited

3

After a judge ordered Trump's name be removed from the Kennedy Center, president says it will 'soon be closed, probably never to open again'

1

Surging Treasury yields expose a brutal truth: America has no margin for error on its $39 trillion debt

2

U.S. says deals with Iran for safe Hormuz transit are prohibited

3

After a judge ordered Trump's name be removed from the Kennedy Center, president says it will 'soon be closed, probably never to open again'
FinanceElon Musk

The lawyers who blocked Elon Musk’s Tesla pay package are demanding a $5.6 billion payout and are prepared to ‘eat our cooking’

By
Dylan Sloan
Dylan Sloan
Down Arrow Button Icon
By
Dylan Sloan
Dylan Sloan
Down Arrow Button Icon
June 10, 2024, 4:38 PM ET
Elon Musk onstage.
Tesla shareholders will this Thursday vote on Elon Musk’s $56 billion pay package, which was struck down by a Delaware judge earlier this year. Apu Gomes—Getty Images

Elon Musk could have $56 billion riding on the outcome of Tesla’s annual meeting this Thursday, when the automaker’s stockholders will vote on the CEO’s record-setting 2018 pay package.

Recommended Video

But there’s another group that stands to land a record windfall: The legal team that successfully argued against Musk’s payout in a Delaware court earlier this year is seeking a whopping $5.6 billion in stock-based legal fees—17 times as large as the biggest fee in Delaware history.

“We recognize that the requested fee is unprecedented … The size of the requested award is great because the value of the benefit to Tesla that Plaintiff’s Counsel achieved was massive,” the plaintiff’s legal team wrote in a court filing. “We are prepared to ‘eat our cooking.’”

Tesla shareholders will give Musk an answer later this week, but the opposing lawyers will have to wait until a hearing scheduled for July 8 for the Delaware Court of Chancery to approve or deny the fees they’re seeking.

Musk himself has voiced strong opposition to the lawyers’ fee proposal. “The lawyers who did nothing but damage Tesla want $6 billion. Criminal,” Musk previously wrote in a post on his personal X account.

The lawyers seeking the $5.6 billion in fees represented plaintiff Richard Tornetta, a Tesla shareholder who filed a suit in 2018 protesting Musk’s compensation package, which had earlier received the approval of Tesla’s board and 70% of the company’s shareholders.

It was structured so that Musk would unlock certain stock awards if he guided the company to various milestones based on metrics like market capitalization. Under Musk’s leadership, Tesla blew past those milestones faster than anyone expected, hitting $1 trillion in market cap by 2021. (It’s since retreated, to just over $551 billion today.)

But Delaware Chancellor Kathaleen McCormick sided with Tornetta earlier this year, concluding that Musk’s pay package was an “unfathomable sum” and the process to approve it was “deeply flawed,” in part because the Tesla board contains many of Musk’s close friends and colleagues.

Tesla shareholders will decide whether to reverse the Delaware court decision this Thursday. But regardless of the outcome, the plaintiff’s lawyers won the case, and they’re demanding their pound of flesh. While extremely high in dollar terms, the fee the lawyers are requesting is well below what other litigators have been awarded in percentage terms—just 10% of the $56 billion they saved Tesla shareholders by voiding Musk’s payout.

Last year, the Delaware Court of Chancery awarded lawyers 27% of the $1 billion settlement from an M&A case involving Dell, and in 2011 lawyers netted 15% of the $2 billion in damages stemming from a case involving mining company Southern Peru Copper Corp.

Delaware courts reward lawyers who pursue complex cases into the late stages of litigation and get “real results,” Delaware Vice Chancellor J. Travis Laster said in approving the Dell litigators’ fee application.

But even though the percentage might be relatively modest, the monumental scale of the ruling makes the lawyers’ fee application extraordinary.

“The dollar amount requested in the fee petition is unusual,” McCormick conceded in a court filing.

Even if Tesla shareholders vote to reinstate Musk’s pay package, there’s no guarantee he would actually get the money. Corporate law isn’t clear on whether a shareholder vote is sufficient to overturn a legal ruling, and Musk could be required to go back to court to get final approval for the money. If shareholders don’t vote in his favor, analysts have speculated Musk could stop paying as much attention to Tesla and spend more of his time focusing on his other companies.

“Elon is not a typical executive, and Tesla is not a typical company,” Tesla board chair Robyn Denholm said. “So the typical way in which companies compensate key executives is not going to drive results for Tesla. Motivating someone like Elon requires something different.”

About the Author
By Dylan Sloan
See full bioRight Arrow Button Icon

Latest in Finance

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • Pinterest icon

Latest in Finance

Elon Musk surrounded by Money symbols
InvestingFinance
If Elon Musk merges SpaceX with Tesla he’ll create a $3.4 trillion behemoth—with zero profits
By Shawn TullyMay 31, 2026
3 hours ago
Oil bosses warn prices will soar in a matter of weeks as inventories near unprecedented lows — ‘I mean really, really low levels’
EnergyOil
Oil bosses warn prices will soar in a matter of weeks as inventories near unprecedented lows — ‘I mean really, really low levels’
By Jason MaMay 30, 2026
12 hours ago
U.S. military fires missile into engine room of blockade runner after it ignored more than 20 warnings while trying to enter an Iranian port
PoliticsIran
U.S. military fires missile into engine room of blockade runner after it ignored more than 20 warnings while trying to enter an Iranian port
By Konstantin Toropin and The Associated PressMay 30, 2026
14 hours ago
Damn the torpedoes — More ships are quietly slipping through the Strait of Hormuz as helicopters scare off Iran’s fast-attack boats
EnergyIran
Damn the torpedoes — More ships are quietly slipping through the Strait of Hormuz as helicopters scare off Iran’s fast-attack boats
By Jason MaMay 30, 2026
17 hours ago
Warren Buffett’s son Peter didn’t know his dad was a billionaire until his 20s—he found out from a rich list
SuccessWarren Buffett
Warren Buffett’s son Peter didn’t know his dad was a billionaire until his 20s—he found out from a rich list
By Sydney LakeMay 30, 2026
18 hours ago
Americans hurt in Kuwait as Trump sends mixed signals on war
PoliticsIran
Americans hurt in Kuwait as Trump sends mixed signals on war
By Kate Sullivan, Michelle Jamrisko, Gerry Doyle and BloombergMay 30, 2026
19 hours ago

Most Popular

Surging Treasury yields expose a brutal truth: America has no margin for error on its $39 trillion debt
Economy
Surging Treasury yields expose a brutal truth: America has no margin for error on its $39 trillion debt
By Shawn TullyMay 30, 2026
1 day ago
U.S. says deals with Iran for safe Hormuz transit are prohibited
Politics
U.S. says deals with Iran for safe Hormuz transit are prohibited
By Jack Wittels and BloombergMay 30, 2026
20 hours ago
After a judge ordered Trump's name be removed from the Kennedy Center, president says it will 'soon be closed, probably never to open again'
Law
After a judge ordered Trump's name be removed from the Kennedy Center, president says it will 'soon be closed, probably never to open again'
By Collin Binkley and The Associated PressMay 30, 2026
14 hours ago
Gen Z is rejecting $200 dates and choosing 'solo-maxxing'—and dating apps are taking a hit
Economy
Gen Z is rejecting $200 dates and choosing 'solo-maxxing'—and dating apps are taking a hit
By Sydney LakeMay 30, 2026
24 hours ago
After Blue Origin rocket explosion, NASA's entire moon exploration program depends on SpaceX for now as Musk eyes blockbuster IPO soon
Innovation
After Blue Origin rocket explosion, NASA's entire moon exploration program depends on SpaceX for now as Musk eyes blockbuster IPO soon
By Jason MaMay 30, 2026
15 hours ago
Current price of oil as of May 29, 2026
Personal Finance
Current price of oil as of May 29, 2026
By Joseph HostetlerMay 29, 2026
2 days ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.