Delaware Judge Recuses Himself from Elon Musk Lawsuits
A judge in Delaware announced on Monday that he will step back from several lawsuits involving Elon Musk. This decision comes after Musk’s legal team claimed bias due to a LinkedIn post where comments seemed to make light of the billionaire.
Katherine St. J. McCormick, Chief Justice of the Delaware Court of Chancery, stated that after Musk’s team raised concerns about the social media activity, he would be reassigning the case to another judge.
While McCormick distanced himself from the case, he insisted he holds no bias against Musk.
“The motion for retraction is based on the incorrect assumption that I support my LinkedIn posts regarding Mr. Musk, when in fact I do not,” she explained. “I am not biased against the defendant in these actions.”
McCormick added, “However, the motion for reassignment has been granted. Clearly, the unwarranted media attention around judges’ involvement in litigation is harmful to the justice system.”
She noted that the case would be referred to three other judges on the Delaware Court of Chancery, the leading venue for corporate lawsuits in the country, where judges frequently handle significant disputes related to corporate governance and fiduciary duties.
Recently, Musk’s attorneys called for McCormick’s resignation, suggesting her actions indicated she “supported” a post mocking Musk for a tweet he made in 2022 about his $44 billion acquisition of Twitter. On LinkedIn, using the “Support” feature is akin to “liking” something on social media.
The legal team argued that McCormick’s social media involvement prompted inevitable bias, which Delaware law says necessitates recusal if there’s a reasonable doubt about a judge’s impartiality.
Musk’s previous legal troubles included a consolidated shareholder derivative action that accused him and Tesla’s board of violating fiduciary duties, particularly regarding executive compensation and corporate governance matters.
One critical lawsuit from the Detroit Pension Fund challenges the way Tesla’s directors awarded themselves stock-based compensation, claiming it harmed the company due to excessive pay and lack of oversight.
These lawsuits interlink with issues relating to Musk’s behavior in connection with his Twitter dealings from 2022 and overlap with a recent federal case in California.
McCormick has overseen several high-profile cases involving Musk, including one that pushed him into completing a $44 billion deal for Twitter after initially trying to back out.
The matter progressed swiftly under McCormick’s supervision, moving to trial where a judge could have forced Musk to back out of the deal. Instead, Musk withdrew just days before the trial commenced, ultimately finalizing the acquisition.
Contention between Musk and McCormick heightened in 2024 when a court criticized McCormick’s processes, claiming she was improperly influenced by Musk, which led to voiding his substantial Tesla compensation package valued around $56 billion at the time.
Although the Delaware Supreme Court later reversed the decision on relief grounds, reinstating the pay package, the scenario escalated Musk’s dissatisfaction with the Delaware court system, prompting him to recommend businesses incorporate elsewhere and sparking a wider discussion about Delaware’s dominance in corporate law.
The Post has reached out to both Musk and McCormick for their reactions.
