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Elon Musk's multibillion-dollar pay package is rejected for a second time. What to know

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Elon Musk's multibillion-dollar pay package is rejected for a second time. What to know

A Delaware judge rejected Tesla Chief Executive Elon Musk’s multibillion-dollar pay package for a second time, writing in her opinion this week that the company’s approval process for the package was “deeply flawed.”

Tesla shareholders approved the compensation plan in 2018, which was once valued at $56 billion but fluctuates dramatically with Tesla’s stock price. Chancellor Kathaleen McCormick first rejected the plan earlier this year on the grounds that Musk had unfair influence over shareholders and that negotiations over his pay plan were not legitimate.

McCormick rejected the plan again this week, citing similar reasons, although attorneys for Musk have argued that the outsized compensation plan is justified because it’s directly tied to Tesla’s valuation, which currently sits at more than $1 trillion.

A dominant player in the electric vehicle market, Tesla has faced setbacks this year amid increased competition and safety concerns surrounding its Full Self-Driving mode. The company slashed more than 10% of its global workforce in April, citing a need to cut costs.

Musk was tapped last month to lead President-elect Donald Trump’s new Department of Government Efficiency, a role that could bolster his influence and Tesla’s standing.

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How did we get here?

Tesla shareholder Richard Tornetta filed a lawsuit against Musk and the company in 2018 after the majority of shareholders approved a 10-year performance-based pay package for Musk.

Tornetta alleged that Musk misled investors who approved the plan and exercised inappropriate influence over negotiations. Musk denied the allegations at trial, saying he did not control the terms of the pay package or attend meetings where it was discussed.

McCormick sided with Tornetta in January and blocked the plan. After the ruling, Tesla shareholders voted again to approve the pay package, with more than 70% in favor, but it was not enough to change McCormick’s mind.

Why did the judge rule twice?

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After McCormick’s first ruling, Musk’s attorneys argued that the shareholders’ overwhelming support of his compensation plan should override the court’s decision. Tesla shareholders voted twice to approve the plan, but McCormick maintained that they were not acting independently.

“There were undoubtedly a range of healthy amounts that the board could have decided to pay Musk,” McCormick wrote in her second opinion. Instead, the board “capitulated to Musk’s terms and then failed to prove that those terms were entirely fair,” she said.

McCormick said that it was not standard for a judge to change a ruling based on the vote of shareholders. There was “no procedural ground” to reverse the decision, she wrote.

How does Musk’s pay compare?

If approved, Musk’s compensation plan would be the largest in U.S. history for a public company executive, according to CNBC. The pay plan includes a series of 12 milestones and would award Musk additional Tesla shares as the company grows.

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In order for Musk to reach each milestone, Tesla’s market capitalization must increase in $50-billion increments. For Musk to fully vest in the award, the company’s market cap must reach $650 billion, the company said.

Musk’s attorneys argue that the pay plan is a reflection of what the executive is worth, but McCormick disagrees. In her second ruling, the judge also awarded the plaintiffs $345 million in legal fees, although plaintiff attorneys had asked for a whopping $5.6 billion.

Who’s right?

Corporate governance expert Charles Elson said the Delaware court’s ruling was sound and in line with the law because Musk had violated conflict of interest regulations. Tesla also created improper new evidence after McCormick’s first decision by calling for a second shareholder vote, he said.

“The judge found that the board was not independent of Musk and there was no negotiation between him and the board that produced this package, which makes it suspect,” Elson said. “The standard rules have to apply.”

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What will Musk do now?

Musk criticized McCormick’s ruling on X, the social media platform he owns, writing that “shareholders should control company votes, not judges.”

Tesla also posted on X that the court’s decision was wrong and the company plans to appeal. The appeal would be filed with the Delaware Supreme Court.

“This ruling, if not overturned, means that judges and plaintiffs’ lawyers run Delaware companies rather than their rightful owners,” the company wrote.

Attorneys for Tornetta and the other shareholders who oppose Musk’s pay plan said they would defend the court’s ruling if the decision is appealed.

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The Associated Press contributed to this report.

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Polymarket Bets on Paris Temperature Prompt Investigation After Unusual Spikes

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Polymarket Bets on Paris Temperature Prompt Investigation After Unusual Spikes

Early in April, Ruben Hallali got an unusual alert on his phone: The evening temperature at Paris Charles de Gaulle International Airport had jumped about 6 degrees Fahrenheit in seconds.

Mr. Hallali, the chief executive of the weather risk company Sereno, had set up notifications for extreme weather swings. Then, nine days later, it happened again.

“It was an isolated jump, at one single station, early in the evening,” said Mr. Hallali, who added that he noticed another strange coincidence about the spikes: The timing was just right for somebody to reap a windfall on the betting site Polymarket.

He wasn’t the only one who sensed a problem. Météo-France, the country’s national meteorological service, filed a complaint last week with the police and local prosecutors, saying it had evidence that a weather sensor at Charles de Gaulle, the country’s largest airport, may have been tampered with.

The temperature swings, experts said, coincided with a period of unusual activity on Polymarket, one of the leading online prediction markets, which allow users to wager on the outcome of virtually anything.

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One increasingly popular area is weather betting, where speculators can make real-time wagers on temperature readings, rainfall totals, the number of Atlantic hurricanes in a year and much more — with payouts in the thousands of dollars and higher.

As the stakes rise, so has the temptation to tamper with the instruments used to generate weather readings in hopes of engineering a lucrative outcome. Experts warn that this could have dangerous ripple effects, like degrading the information that underpins safe air travel.

Temperature data is used in a host of calculations at airports, helping determine correct takeoff distance, climb rate and whether crews need to apply frost treatment to planes. It’s crucial to airport safety, Mr. Hallali said.

“The Charles de Gaulle incident is not an isolated curiosity,” Mr. Hallali said. “It is what happens when financial incentives meet fragile data infrastructure.”

On April 6, the temperature reading at Charles de Gaulle jumped from 64 degrees Fahrenheit to 70 degrees at 7 p.m., before slowly falling over the next hour, according to data from Météo-France.

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On April 15, the recorded temperature climbed even more sharply, from 61 degrees at 9 p.m. to 72 at 9:30 p.m., then dropping back to 61 a half-hour later.

In both instances, the spikes set the high temperature for the day, the metric on which some Polymarket wagers rest.

Laurent Becler, a spokesman for Météo-France, said the service contacted the police after noticing the discrepancies in temperature data. He declined to comment further on the case, saying it was under investigation.

Mr. Hallali said that after the first instance, experts and commenters on the French weather forum Infoclimat began to search answers. Theories were floated, including user error. But after the second spike, commenters zeroed in on the unusual Polymarket wagers, which totaled nearly $1.4 million over the two days, according to the company’s data.

The sums bet on April 6 and 15 were hundreds of thousands of dollars higher than on typical days this month.

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It is not the first time that strange bets on prediction markets have raised accusations of insider trading.

On Thursday, a U.S. Army special forces soldier who helped capture President Nicolás Maduro of Venezuela in January was charged with using classified information to bet on outcomes related to Venezuela, making more than $400,000 on Polymarket. Late last year, another trader on the site made roughly $300,000 betting on last-minute pardons from President Joseph R. Biden Jr. before he left office.

Polymarket did not immediately respond to a request for comment. While the site used to tie some bets to temperature readings at Charles de Gaulle, this week, after Météo-France filed its complaint, the platform began using temperatures taken at another airport near the city, Paris-Le Bourget, according to recent bets on the site.

Representatives for Charles de Gaulle airport declined to comment beyond saying that the case was under investigation. The airport police also declined to comment. The Bobigny Public Prosecutor’s Office, which is handling the case, declined to answer questions about the investigation but said that no complaint had been filed against Polymarket.

As to how the instruments could have been tampered with, a number of theories have been offered online, including by use of a hair dryer or a lighter. Mr. Hallali said that the precision of the spike on April 15 suggested the use of a calibrated portable heating device, although he declined to speculate about what kind.

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“Markets are expanding into every domain where an outcome can be observed, measured, and settled,” he said. “As these markets multiply, so does the surface area for manipulation.”

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California’s jet fuel stockpile hits two-year low as war strangles oil supplies

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California’s jet fuel stockpile hits two-year low as war strangles oil supplies

As the war in Iran strangles the flow of oil around the globe, California’s jet fuel reservoirs are running low.

The state — which refines much of its own fuel in El Segundo and elsewhere but still relies on crude oil imports — has seen its jet fuel stock decline by more than 25% from last year’s peak to a level not seen since 2023, according to data from the California Energy Commission.

The supply is shrinking as a global shortage is already affecting travelers’ summer plans with canceled flights and higher fares. It could even affect plans for people coming to Los Angeles for the 2026 World Cup, which starts in June, said Mike Duignan, a hospitality expert and professor at Paris 1 Panthéon-Sorbonne University.

“People don’t know exactly how this is going to escalate,” he said. “There’s a huge black cloud over the sea for the World Cup and the travel slump that we’re seeing is all linked to this oil shortage.”

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As fuel supplies shrink, flight prices are rising. Airlines are adding baggage surcharges to cover fuel costs. Several routes leaving from smaller California hubs, including Sacramento and Burbank, have already been canceled.

Air Canada has suspended flights for this summer, cutting routes from JFK to Toronto and Montreal.

“Jet fuel prices have doubled since the start of the Iran conflict, affecting some lower profitability routes and flights which now are no longer economically feasible,” the airline said in a statement last week.

Europe had just more than a month’s supply of jet fuel left last week, the International Energy Agency said. In an effort to cut costs, the German airline Lufthansa slashed 20,000 flights from its summer schedule this week.

Without a fresh oil supply flowing through the Strait of Hormuz, the situation is unlikely to improve, experts said. The oil reserves countries and companies have in storage are helping fill shortfalls, but the squeezed supply chain could still wreak economic havoc.

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“When there’s a shortage somewhere, everything is affected,” said Alan Fyall, an associate dean of the University of Central Florida Rosen College of Hospitality Management. “Airlines are being cautious, and I would say that is a very wise strategy at the moment.”

California’s jet fuel stock reached its lowest levels in two and a half years at 2.6 million barrels last week, down from a peak of more than 3.5 million barrels last year.

The California Energy Commission, which tracks fuel inventory, said the state’s current jet fuel stock is sill sufficient.

“Current production and inventory levels of jet fuel are within historical ranges,” a spokesperson said. “Although supply is tight, no structural deficit has emerged yet. The present tightness reflects short‑term global market stress. As long as refinery operations remain stable, California is positioned to meet regional jet fuel needs.”

Europe has been affected more directly because it relies on the Middle East for the vast majority of its crude oil and many refined products, experts said. California gets crude oil from the Middle East but also from Canada, Argentina and Guyana.

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The state has the capacity to refine around 200,000 barrels of jet fuel per day, most of it from refineries in El Segundo and Richmond.

The amount of crude oil originating in the state has been declining since the early 2000s, as state regulations and drilling costs have led to more imports.

California has become particularly vulnerable to supply-chain shocks like the war in Iran, says Chevron, one of the companies that provides jet fuel in the state.

“The conflict in the Mideast Gulf has exposed the danger of California’s decision to offshore energy production,” said Ross Allen, a Chevron spokesperson. “Taxes, red tape and burdensome regulations cost the state nearly 18% of its refinery capacity in just the past year, and we urge policymakers to protect the remaining manufacturing capacity.”

In 2025, 61% of crude oil supply to California’s refineries came from foreign sources, according to the California Energy Commission. Around 23% came from inside the state, down from 35% five years ago.

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The state’s refining capacity has also been declining, said Jesus David, senior vice president of Energy at IIR Energy. The West Coast region’s refining capacity has decreased from 2.9 million to 2.3 million barrels a day since 2019, he said.

“California’s had issues prior to the war,” David said. “Nothing new has been built over the past 30 years, and California has closed a lot of capacity.”

The result is higher prices for both gasoline and jet fuel in the state. Jet fuel at LAX costs close to $15 per gallon this week, compared with almost $10 at Denver International Airport and $11 at Newark International Airport.

Gasoline prices have also been hit hard by the global conflict. Average gas prices in California are close to $6 a gallon, around $2 higher than the national average.

The West Coast is a “fuel island” because it’s not connected by pipelines to the rest of the country, United Airlines chief executive Scott Kirby said in an interview last month. That means oil and refined products have to be brought in by ships.

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“Fuel price is more susceptible to supply weakness on the West Coast than anywhere else in the country,” Kirby said.

Some airlines might not survive the turmoil if oil prices don’t level out soon, he said. Spirit Airlines, a budget carrier based in Florida, is reportedly facing imminent liquidation if it isn’t bailed out by the Trump administration.

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Nike to Cut 1,400 Jobs as Part of Its Turnaround Plan

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Nike to Cut 1,400 Jobs as Part of Its Turnaround Plan

Nike is cutting about 1,400 jobs in its operations division, mostly from its technology department, the company said Thursday.

In a note to employees, Venkatesh Alagirisamy, the chief operating officer of Nike, said that management was nearly done reorganizing the business for its turnaround plan, and that the goal was to operate with “more speed, simplicity and precision.”

“This is not a new direction,” Mr. Alagirisamy told employees. “It is the next phase of the work already underway.”

Nike, the world’s largest sportswear company, is trying to recover after missteps led to a prolonged sales slump, in which the brand leaned into lifestyle products and away from performance shoes and apparel. Elliott Hill, the chief executive, has worked to realign the company around sports and speed up product development to create more breakthrough innovations.

In March, Nike told investors that it expected sales to fall this year, with growth in North America offset by poor performance in Asia, where the brand is struggling to rejuvenate sales in China. Executives said at the time that more volatility brought on by the war in the Middle East and rising oil prices might continue to affect its business.

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The reorganization has involved cuts across many parts of the organization, including at its headquarters in Beaverton, Ore. Nike slashed some corporate staff last year and eliminated nearly 800 jobs at distribution centers in January.

“You never want to have to go through any sort of layoffs, but to re-center the company, we’re doing some of that,” Mr. Hill said in an interview earlier this year.

Mr. Alagirisamy told employees that Nike was reshaping its technology team and centering employees at its headquarters and a tech center in Bengaluru, India. The layoffs will affect workers across North America, Europe and Asia.

The cuts will also affect staffing in Nike’s factories for Air, the company’s proprietary cushioning system. Employees who work on the supply chain for raw materials will also experience changes as staff is integrated into footwear and apparel teams.

Nike’s Converse brand, which has struggled for years to revive sales, will move some of its engineering resources closer to the factories they support, the company said.

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Mr. Alagirisamy said the moves were necessary to optimize Nike’s supply chain, deploy technology faster and bolster relationships with suppliers.

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