SpaceX CEO Elon Musk publicly railed against the Diamond State and a judge’s decision to void his $55 billion Tesla pay package.
Representatives for SpaceX and the Texas Secretary of State did not immediately return a request for comment from Business Insider.
Musk posted on Wednesday about the decision to move to Texas on his social platform X (formerly Twitter).
SpaceX has moved its state of incorporation from Delaware to Texas!
If your company is still incorporated in Delaware, I recommend moving to another state as soon as possible. pic.twitter.com/B7FLByL2dY
— Elon Musk (@elonmusk) February 15, 2024
The filing comes less than a month after a judge in Delaware voided Musk’s $55 billion Tesla pay package — a decision that threatened Musk’s rein as the world’s richest person. The ruling was in response to a 2018 lawsuit brought on by a Tesla shareholder who believed the pay was excessive. The judge concluded that Tesla didn’t give good enough reasoning for the compensation plan and that the board lacked independence. Tesla can still appeal the decision.
In response to the ruling, Musk lashed out online against the state, which is otherwise known for tax laws favorable to companies that incorporate there.
He tweeted: “Never incorporate your company in the state of Delaware.”
And earlier this month, he followed up with an informal poll on X regarding where he should move Tesla. “The public vote is unequivocally in favor of Texas,” Musk wrote on February 1. “Tesla will move immediately to hold a shareholder vote.”
Already, Musk has moved the business incorporation of his brain-chip company, Neuralink, out of Delaware and into Nevada. However, it may be more complicated to get Tesla’s incorporation out of the Diamond State since it’s a public company, unlike Neuralink and SpaceX, Bloomberg reported.
But Texas is a long way from becoming the business beacon that Delaware is, Charles Elson, founding director of the Weinberg Center for Corporate Governance at the University of Delaware, recently told The Wall Street Journal.
“Frankly, to move because [Musk] is unhappy with a particular judge’s ruling at a particular point in time is very ill-advised,” he said. “The capital you’re going to have to expend to create a real business court with that expertise is going to be a lot more, frankly, than the income it produces.”
SpaceX already has many operations in Texas. Just a few miles from the company’s launch site in Brownsville, SpaceX will be constructing a $100 million office building, according to a Tuesday filing with the state. In 2021, Musk announced his plan to move Tesla’s headquarters to Austin from Silicon Valley.
