Judge Sinks Elon Musk’s $56B Tesla Pay Package

In episode #2878, Eric Siu and Neil Patel discuss the recent legal ruling against Elon Musk's $56 billion pay package, despite shareholder approval. They explore the implications of such legal decisions on business operations and the broader context of public figures in the business world, contrasting Musk's visibility with the anonymity of other successful entrepreneurs. Don’t forget to help us grow by subscribing and liking on YouTube! Check out more of Eric’s content (Leveling UP YT) and Neil’s videos (Neil Patel YT) TIME-STAMPED SHOW NOTES: (00:00) Elon Musk's $56 Billion Pay Package Controversy (02:53) The Impact of Legal Decisions on Business (05:45) The Dichotomy of Public Figures: Elon Musk vs. Anonymous Wealth (06:22) That’s it for today! Don’t forget to rate, review, and subscribe! Go to https://www.marketingschool.io to learn more! Leave Some Feedback: What should we talk about next? Did you enjoy this episode? If so, please leave a short review. Connect with Us: Single Grain << Eric’s ad agency NP Digital << Neil’s ad agency X @neilpatel X @ericosiu

• 0:00Speaker 00

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• 0:34Speaker 01

  Judge confirms the decision to sink Elon Musk's $56 billion pay package despite the Tesla shareholder vote.

• 0:43Speaker 02

  Musk won't get the salary he wanted.

• 0:45Speaker 03

  Elon Musk has had his Tesla pay blocked by a judge. Yes, $56 billion pay award will not be reinstated.

• 0:55Speaker 01

  So originally Elon Musk had a $56 billion pay package.

• 0:59Speaker 00

  For performing.

• 0:59Speaker 01

  For performing.

• 1:00Speaker 00

  Insane goals that were basically unachievable.

• 1:03Speaker 01

  And for a company that wasn't doing well at all financially.

• 1:06Speaker 00

  Yep.

• 1:06Speaker 01

  And it had a potential of going under, but he not only saved the company, he made it, you know, blow up in a good way. So the original judge decided, you know what? Forget you Elon, you're not going to get this money. All right?

• 1:17Speaker 00

  Because one person, a very small shareholder, said, hey, you know what? I don't think he should get it. It's unfair.

• 1:23Speaker 01

  Yes, even though he was the one who made the shareholders tons of money as well. So the judge is like, all right, you're not getting paid. So then Musk, you know, of course he moved his business to Texas. I think they moved their incorporation too, out of Delaware to Texas, I believe it was.

• 1:40Speaker 00

  I'm not sure about that.

• 1:40Speaker 01

  It was some state or it was to Delaware, wherever they ended up changing it to. They casted a shareholder vote. The shareholder said, yes, we believe you should get paid your $56 billion.

• 1:50Speaker 00

  The vast majority of them, yeah.

• 1:51Speaker 01

  Yeah, well, he won majority.

• 1:53Speaker 00

  Yeah.

• 1:53Speaker 01

  And then again, today. Judge decided, I don't know if it's the same or a different one, but a judge decided that he's not going to get paid his 56 billion, even though the shareholders voted that he should the majority. And here's the kicker, the plaintiff's attorney, right? The people who are fighting against him, they just got awarded $345 million from the judge.

• 2:14Speaker 00

  You know what this is? This is, this is the same thing that like, I don't care which side you're on. This is lawfare, right? Where, where like they went after the, the president elect before and they tried to like go after him for all these like, um, small things. It wasn't even like big charges, right? It was like, um, accounting fraud or whatever, right? And they made him, made him into a convicted felon. In this case, this is like, they're just, this guy performed and this guy, we were talking about meritocracy, right? This guy performed and then his shareholders, shareholders voted that he should get the money. And yet at the same time, they're still going to take it away.

• 2:44Speaker 01

  And, and the judge has nothing to do with the company. The law has nothing to do with the business. Shareholders want the CEO to get paid because they believe he deserves it, majority of them. And yet, uh, the government wants to step in and say, no, we don't care what your shareholders and the people who own your stock say. You don't get it. And you know what? We're going to give the attorney who sued you guys $345 million for his service.

• 3:09Speaker 00

  It just goes to show you, not everything's fair. This is just how our incentives are set up. You know, show me the incentive, I'll show you the outcome. The thing that for sure, we, even a couple of months ago, people were just like, it's going to become way harder to do business in Delaware because before Delaware was a cool state to do business in because they were flexible, right?

• 3:25Speaker 01

  Not anymore.

• 3:26Speaker 00

  They're definitely not flexible in this case. And so where you decide to do business matters at the end of the day, I think we still believe that America is still the best place to do business, but stuff like this makes it way harder. I do believe with Elon and Vivek coming in and then, you know, Trump's, Trump's administration coming in, this will probably get rolled back.

• 3:43Speaker 01

  No, I think it's over with.

• 3:45Speaker 00

  You think it's over with?

• 3:45Speaker 01

  This is the second time.

• 3:47Speaker 00

  I think, come on.

• 3:48Speaker 01

  I don't know how many times.

• 3:49Speaker 00

  You're not just gonna let 56 billion dollars go away.

• 3:52Speaker 01

  Yeah, but in with the US law, I don't think you can keep fighting the same thing over and over again.

• 3:56Speaker 00

  Well, I think we'd have to look into, I don't know what.

• 3:58Speaker 01

  I don't know law, but the first time he didn't get what he wanted. So I believe he did appeal or something and to refight it. And then he lost the second time.

• 4:07Speaker 00

  I don't know if there's a limit to how many times you can sue for something.

• 4:11Speaker 00

  And if there is-

• 4:12Speaker 01

  This I know, there is a limit-

• 4:13Speaker 00

  If there is, it's not just two. I think it's gotta be at least like three strikes, you know? It's arbitrary, it's like, we want 2% inflation rate. Where does that come from? It's arbitrary.

• 4:22Speaker 01

  Yeah.

• 4:22Speaker 00

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• 5:07Speaker 01

  And knowing these lawyers, they can find something else to sue for that's quasi-related and try to get the money, but it's just screwed up.

• 5:15Speaker 00

  I think the other thing too is like, this is another, you know, the difference between Elon Musk versus the Zara founder, Ortega. Do you know what the difference is? So Zara is very big, right? It's a conglomerate, right? And he owns the, I don't know if you know this, the Zara founder owns a bunch of like $20 billion worth of real estate. And he basically rents out space to like the Facebooks of the world, right? Or the, like, a lot of big tech companies.

• 5:39Speaker 01

  No, I didn't know that.

• 5:40Speaker 00

  My point is, he came from nothing. He built his company up. I don't know how big Zara is right now, but Zara drives a lion's share of that group's revenue. The point is, he's always been about not taking any pictures in public. He's always been about not being famous. He just wants to work really hard, right? He works when it's the holidays. He works when it's, he just loves working, right? And I think Elon, like, I think we both think he's a great entrepreneur. I think there is a downside to becoming the most followed person on X, for example, right? And saying what you want.

• 6:10Speaker 01

  Yeah.

• 6:11Speaker 00

  This is also why so many people hate Trump too. So many people hate Elon. It's because, you know, they speak their mind and I respect them for doing it, for doing it. But the other argument is maybe you just wanna be rich and anonymous.

• 6:22Speaker 01

  I think the best is to be rich and anonymous.

• 6:24Speaker 00

  It is.

• 6:25Speaker 01

  Elon, of course, is on a mission. Although I think social media has changed. It's starting to be OK to say what's on your mind.

• 6:31Speaker 00

  Well, the Overton window, do you know? We should explain the Overton window. Do you know what the Overton window is?

• 6:35Speaker 01

  I do not.

• 6:35Speaker 00

  OK, so you'll know what it is. The Overton window is basically the window around the things that you can and you can't say. So now the things that you can say is like, hey, no more ESG stuff, OK? You see Walmart rolling back DEI. You see Toyota rolling back DEI. Those things are now OK to say, and people are pushing back now. So, but you couldn't do that like two, three years ago. That is it for today. Go to marketing school.io/agency. By the way, that price keeps going up. It just doubled last yesterday, actually. So yeah, go check it out, and we'll see you tomorrow.