Tesla attorneys ask judge to vacate decision invalidating massive pay package for Elon Musk

a request

Defense attorneys say the vote makes clear that Tesla shareholders, with full knowledge of the flaws in the 2018 process that McCormick pointed out in her January ruling, are adamant that Musk is entitled to the pay package. Photo via cdn.britannica.com

Attorneys for Elon Musk and Tesla’s corporate directors are asking a Delaware judge to vacate her ruling requiring the company to rescind a massive and unprecedented pay package for Musk.

Friday's hearing follows a January ruling in which Chancellor Kathaleen St. Jude McCormick concluded that Musk engineered the landmark 2018 pay package in sham negotiations with directors who were not independent. The compensation package initially carried a potential maximum value of about $56 billion, but that sum has fluctuated over the years based on Tesla's stock price.

Following the court ruling, Tesla shareholders met in June and ratified Musk’s 2018 pay package for a second time, again by an overwhelming margin.

“Honoring the shoulder vote would affirm the strength of our corporate system,” David Ross, an attorney for Musk and the other individual defendants, told McCormick. “This was stockholder democracy working.”

Ross told the judge that the defendants were not challenging the factual findings or legal conclusions in her ruling, but simply asking that she vacate her order directing Tesla to rescind the pay package.

McCormick, however, seemed skeptical of the defense arguments, peppering attorneys with questions and noting that there is no precedent in Delaware law for allowing a post-trial shareholder vote to ratify adjudicated breaches of fiduciary duty by corporate directors.

“This has never been done before,” she said.

Defense attorneys argued that, while they could find no case that is exactly comparable, Delaware law has long recognized shareholder ratification as a cure to corporate governance errors, and has long acknowledged the “sovereignty” of shareholders as the ultimate owners of a corporation.

“I candidly don’t see how Delaware law can tell the owners of the company that they’re not entitled to make the decision they made,” said Rudolf Koch, an attorney for Tesla.

Donald Verrilli, a lawyer for an induvial stockholder who owns more than 19,000 Tesla shares, suggested that it would be wrong for the lone shareholder who filed the lawsuit to thwart the will of the majority of Tesla shareholders. At the time the lawsuit was filed, the plaintiff owned just nine shares of Tesla stock.

“The voice of the majority of shareholders should matter…. This lawsuit is not representing the interest of the shareholders," Verrilli said.

Thomas Grady, an attorney for a group of Florida objectors who own or manage almost 8 million Tesla shares with some $2 billion, argued that for McCormick to rule for the plaintiff, she has to “disenfranchise” all other Tesla shareholders.

Greg Varallo, an attorney for the plaintiff, urged McCormick not to give any credence to the June shareholder vote, saying it has no legal precedent in Delaware or anywhere else. There also is no reason for the court to reopen the trial record and admit new evidence, he said.

Under Delaware law, stockholders have no authority to overrule courts by trying to use a post-trial ratification vote as a “giant eraser,” Varallo argued.

“Ratification is not magic, and it never has been,” Varallo added. “This should end here and now.”

McCormick gave no indication on when she would rule. She also has yet to rule on a huge and unprecedented fee request by plaintiff attorneys, who contend that they are entitled to legal fees in the form of Tesla stock valued at more than $7 billion.

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Shareholders of the electric vehicle and solar panel company are voting on the package, with the results to be tabulated at Tesla's June 13 annual meeting. Photo via cdn.britannica.com

Elon Musk sees more resistance against his multibillion dollar pay package

just say no

A second shareholder advisory firm has come out against reinstating a pay package for Tesla CEO Elon Musk that was voided earlier this year by a Delaware judge.

ISS late Thursday joined Glass Lewis in recommending against the package, recently valued by the company at $44.9 billion but in January had a value of about $56 billion.

Shareholders of the electric vehicle and solar panel company are voting on the package, with the results to be tabulated at Tesla's June 13 annual meeting.

ISS said in its recommendations on Tesla's proxy voting items that Musk's stock-based package was outsized when it was approved by shareholders in 2018, and it failed to accomplish board objectives voiced at that time.

The firm said that Tesla met the pay package’s performance objectives, and it recognized the company's substantial growth in size and profitability. But concerns about Musk spending too much time on other ventures that were raised in 2018 and since then have not been sufficiently addressed, ISS said.

“The grant, in many ways, failed to achieve the board’s other original objectives of focusing CEO Musk on the interests of Tesla shareholders, as opposed to other business endeavors, and aligning his financial interests more closely with those of Tesla stockholders,” ISS wrote.

Also, future concerns remain unaddressed, including a lack of clarity on Musk's future compensation and the potential for his pay to significantly dilute shareholder value, ISS wrote.

Musk plays big roles in his other ventures including SpaceX, Neuralink and the Boring Company. Last year he bought social media platform X and formed an artificial intelligence unit called xAI.

Last week the other prominent proxy advisory firm, Glass Lewis, also recommended against reinstating Musk's 2018 compensation package. The firm said the package would dilute shareholders' value by about 8.7%. The rationale for the package “does not in our view adequately consider dilution and its long-lasting effects on disinterested shareholders,” Glass Lewis wrote.

But in a proxy filing, Tesla said that Glass Lewis failed to consider that the 2018 award incentivized Musk to create over $735 billion in value for shareholders in the six years since it was approved.

“Tesla is one of the most successful enterprises of our time,” the filing said. “We have revolutionized the automotive market and become the first vertically integrated sustainable energy company."

Tesla is struggling with falling global sales, slowing electric vehicle demand, an aging model lineup and a stock price that has tumbled about 30% this year.

Tesla asked shareholders to restore Musk's pay package after it was rejected by a Delaware judge this year. At the time, it also asked to shift the company’s legal corporate home to Texas.

Glass Lewis recommended against moving the legal corporate home to Texas, but ISS said it favored the move.

California’s public employee retirement system, which holds a stake in Tesla, said it has not made a final decision on how it will vote on Musk’s pay. But CEO Marcie Frost told CNBC that as of Wednesday, the system would not vote in favor. CalPERS, which opposed the package in 2018, said it will discuss the matter with Tesla “in the coming days.”

In January, Delaware Chancellor Kathaleen St. Jude McCormick ruled that Musk is not entitled to the landmark stock compensation that was to be granted over 10 years.

Ruling on a lawsuit from a shareholder, she voided the pay package, saying that Musk essentially controlled the board, making the process of enacting the compensation unfair to stakeholders. “Musk had extensive ties with the persons tasked with negotiating on Tesla’s behalf,” she wrote in her ruling.

In a letter to shareholders released in a regulatory filing last month, Tesla Chairwoman Robyn Denholm said that Musk has delivered on the growth it was looking for at the automaker, with Tesla meeting all of the stock value and operational targets in the 2018 package. Shares at the time were up 571% since the pay package began.

“Because the Delaware Court second-guessed your decision, Elon has not been paid for any of his work for Tesla for the past six years that has helped to generate significant growth and stockholder value,” Denholm wrote. “That strikes us — and the many stockholders from whom we already have heard — as fundamentally unfair, and inconsistent with the will of the stockholders who voted for it.”

Tesla posted record deliveries of more than 1.8 million electric vehicles worldwide in 2023, but the value of its shares has eroded quickly this year as EV sales soften.

The company said it delivered 386,810 vehicles from January through March, nearly 9% fewer than it sold in the same period last year. Future growth is in doubt and it may be a challenge to get shareholders to back a fat pay package in an environment where competition has increased worldwide.

Starting last year, Tesla has cut prices as much as $20,000 on some models. The price cuts caused used electric vehicle values to drop and clipped Tesla’s profit margins.

In April, Tesla said that it was letting about 10% of its workers go, about 14,000 people.

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Chevron names latest cohort of energy transition fellows at Rice University

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Chevron and Rice University have named 10 graduate students to the second cohort of the Chevron Energy Graduate Fellowship.

The students come from various departments at Rice and are working on innovations that reduce emissions or improve upon low-carbon technology. Fellows will each receive a $10,000 award to support their research along with the opportunity to connect with "industry experts who can provide valuable insight on scaling technologies from the lab to commercial application," according to Rice.

The fellows will present projects during a cross-university virtual symposium in the spring.

The 2025-26 Chevron Energy Graduate Fellows and their research topics include:

Cristel Carolina Brindis Flores, Molecular Simulations of CO₂ and H₂ for Geostorage
Davide Cavuto, Intensification of Floating Catalyst Chemical Vapor Deposition for Carbon Nanotubes Synthesis
Jaewoo Kim, Distributed Acoustic Sensing for In-situ Stress Monitoring in Enhanced Geothermal Systems
Jessica Hema Persaud, Understanding Tin Perovskite Crystallization Dynamics for All-Perovskite Tandems
Johanna Ikabu Bangala, Upcycling Methane-derived Zero-Valent Carbon for Sustainable Agriculture
Kashif Liaqat, From Waste to Resource: Increased Sustainability Through Hybrid Waste Heat Recovery Systems for Data Centers and Industry
Md Abid Shahriar Rahman Saadi, Advancing Sustainable Structural, Energy and Food Systems through Engineering of Biopolymers
Ratnika Gupta, Micro-Silicon/Carbon Nanotube Composite Anodes with Metal-free Current Collector for High Performance Li-Ion Batteries
Wei Ping Lam, Electrifying Chemical Manufacturing: High-Pressure Electrochemical CO₂ Capture and Conversion
William Schmid, Light-Driven Thermal Desalination Using Transient Solar Illumination

“Through this fellowship program, we can support outstanding graduate students from across the university who are conducting cutting-edge research across a variety of fields,” Carrie Masiello, director of the Rice Sustainability Institute, said in a news release. “This year, our 2026 Chevron Fellows are working on research that reflects the diversity of the sustainability research at Rice … and these scholarly endeavors exemplify the breadth and depth of research enabled by Chevron’s generous support.”

The Chevron Fellows program launched at Rice last year, naming 10 graduate students to the inaugural cohort. It is funded by Chevron and was created through a partnership between the Rice Sustainability Institute. Chevron launched a similar program at the University of Houston in 2023.

“Rice University continues to be an exceptional partner in advancing energy innovation,” Chris Powers, director of exploration commercial and portfolio at Chevron, added in the release. “The Chevron Energy Fellows program showcases the brilliance and drive of Rice graduate students, whose research in areas like carbon conversion, solar materials and geothermal sensing is already shaping the future of sustainable energy. We’re proud to celebrate their achievements and look forward to the impact they’ll continue to make across the energy landscape.”

Houston clean energy company to develop hybrid renewable project in Port Arthur

power project

Houston-based clean energy company Diligence Offshore Services has announced a strategic partnership with Florida-based floating solar manufacturing company AccuSolar for the development of a renewable energy project in the Port Arthur area.

Known as the Pleasure Island Power Collective, it will be built on 2,275 acres across Pleasure Island and Sabine Lake. It is expected to generate 391 megawatts of clean power, alongside a utility-scale battery energy storage system. It will also feature a 225-megawatt coastal onshore wind farm, with energy produced on-site used to power a data center for adaptive superintelligence, making it entirely self-sustained by renewable sources, according to the company.

AccuSolar will design and manufacture the project and power will be distributed through the Canaan Energy Corridor

“We are incredibly proud to partner with a fellow U.S. company like AccuSolar,” Harry C. Crawford III, founder and managing member of Diligence Offshore, said in a news release. “Their expertise in American manufacturing and floating solar technology is essential to the success of the Pleasure Island Power Collective.”

The project is expected to bring economic growth and a significant number of manufacturing jobs to the area during the construction phase and long-term operations.

Diligence Offshore is pursuing a DPA Title 1 DX rating under the Defense Production Act to help advance the project's development schedule, according to the release, which could lead to immediate manufacturing jobs.

“This partnership not only strengthens our domestic supply chain but also accelerates our vision to bring economic freedom and climate resilience to the Gulf Coast,” Crawford added in the release.

Houston organization proposes Gulf Coast index for hydrogen market

hydrogen index

The Clean Hydrogen Buyers Alliance has proposed an index aimed at bringing transparency to pricing in the emerging hydrogen market.

The Houston-based alliance said the Gulf Coast Hydrogen Index, based on real-time data, would provide more clarity to pricing in the global market for hydrogen. The benchmarking effort is being designed to benefit clean hydrogen buyers, sellers and investors. The index would help position the U.S. “as the trading anchor for hydrogen’s next chapter as a globally traded commodity,” the alliance said.

According to ResearchAndMarkets.com, the global market for clean hydrogen was valued at $200 billion in 2024 and is projected to reach $700 billion by 2040.

John Flory, president of the alliance, said the lack of a pricing index has relegated hydrogen to niche-market status.

“Capital is waiting. Buyers are ready. But until now, there’s been no credible, transparent pricing signal to guide clean hydrogen investing or contracting,” Edward Morse, co-chairman of the Clean Hydrogen Transaction Advisory Committee, said in a news release.

The index would treat the Gulf Coast as the primary delivery hub for pipeline-grade hydrogen in three categories: basic, low-carbon and ultra-low-carbon. It would be similar to the Henry Hub index for pricing of natural gas.

Roger Ballentine, co-chairman of the clean energy advisory committee, said the hydrogen index would build confidence in this energy source among government agencies, companies and investors. A Henry Hub-style benchmark for hydrogen “provides clarity, reduces risk, and lays the foundation for clean energy to become a globally traded commodity critical to decarbonization,” he said.

The Gulf Coast, with Texas as the focal point, is key to the evolution of the U.S. clean hydrogen economy, according to the Fuel Cell and Hydrogen Energy Association.

At the core of the Gulf Coast’s role is the U.S. Department of Energy's selection of the Gulf Coast as one of the country’s seven regional hubs for clean hydrogen. However, the DOE has proposed cutting funding for the HyVelocity Gulf Coast Hydrogen Hub, a $1.2 billion development in Texas and Louisiana by AES, Air Liquide, Chevron, ExxonMobil, MHI Hydrogen Infrastructure and Ørsted, according to a new list of proposed DOE funding cancellations.

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