Even After Delaware Wins, Musk Can’t Take His Ball and Go Home

Just when things seemed to be settling into a new normal for Delaware’s legal system, Elon Musk is back for more.

The world’s wealthiest tech bro escalated his two-year barrage on Chancellor Kathaleen St. J. McCormick, the judge who voided his record $56 billion Tesla Inc. pay plan before the state’s high court restored it.

Musk demanded Wednesday that McCormick recuse herself from the last batch of cases confronting him in Delaware after she allegedly engaged with a LinkedIn post “sneering” at his loss in a securities fraud trial over his $44 billion deal for Twitter Inc.

McCormick responded immediately, insisting that if she did hit LinkedIn’s “support” button, it was accidental. She suggested that her account—which she’s now locked out of—may have been hacked. For now, the litigation is on hold pending a decision on the recusal motion.

For Delaware, where courtroom foes refer to each other as “my friend” and motions for judicial recusal are exceedingly rare, the fresh attacks from Musk are both shocking and unsurprising. His initial wave of insults against McCormick—unleashing the online trolls—was part of a campaign to provoke a mass corporate “DExit” that sparked last year’s divisive state Senate Bill 21, Delaware’s most significant legislative overhaul in decades.

Whether because hard sells from Nevada and Texas are coming up short, because the threat of DExit was never more than a myth spun by private equity lobbyists and the corporate defense bar, or because S.B. 21 did its job, the exodus hasn’t really happened.

Critics say state officials were basically duped, and Musk’s renewed hostility helps them make that case. Even supporters of S.B. 21 have sought to distance themselves from the billionaire, who has spent the past few years dismantling federal agencies and embracing the far-right fringe.

Why can’t Musk take the win after getting his money, bullying Delaware into changing its corporate laws, and leaving? By pressing his luck with eyebrow-raising arguments, he’s reminding the state’s legal ecosystem that the backlash was more about him than everyone else’s fiduciary duties.

The 2024 pay ruling “was quite singular in sparking both the reaction by the corporate community threatening to leave Delaware and in turn the reaction of elites in Delaware to try and stem that tide,” University of Southern California law professor Ryan Bubb said. “There’s an old saying in corporate law that bad facts make bad law. Elon Musk is just sui generis.”

The fresh controversy erupted days after the state’s famed collegiality was on full display at a top M&A conference in New Orleans. The gathering followed a trilogy of Delaware Supreme Court rulings meant to calm the waters, including the Musk pay decision in December and one in February that upheld the legal overhaul. The podium featured shareholder attorneys and corporate defense counsel trading praise as they sparred amicably.

Jeroen van Kwawegen, a prominent shareholder lawyer who co-founded Johnson Van Kwawegen LLP last year, suggested in a LinkedIn post of his own Wednesday that before Musk began flinging accusations, “the responsible thing to do was to contact the judge and check the facts.”

“But that would have required restraint, judgment, and a longer term view on the systemic consequences of our actions,” he wrote.

The method to Musk’s madness seems to involve hitting McCormick with “merciless, continual” attacks that would inspire animus in most people, then arguing she must be prejudiced against him, according to retired University of Delaware law professor Charles Elson.

“This is a form of judge shopping,” Elson said. “If you really get down to it, the one who showed bias was him.”