In rejecting Elon Musk’s $55.8 billion pay package, the Delaware Chancery Court applied straightforward corporate law. But the decision should still worry companies incorporated in the state. The court spends much of its 201-page opinion attacking the value of “superstar” CEOs and the importance of individuals to corporate achievement. While superstars are lauded in sports and entertainment, in Delaware the value of the best CEOs is in doubt.

The collectivist notion that no single person can make a huge difference suffuses the opinion, which asserts that Mr. Musk and other superstar CEOs are merely lucky people who “directors, investors and markets believe make a unique contribution to company value.” The court also assails directors, claiming their belief in a CEO’s value “could be wrongly held.” Board members may be delusional. According to the court, the Tesla board was “starry eyed by Musk’s superstar appeal.”

That’s not all. The court belittled Mr. Musk’s value. Tesla’s lawyers justified Mr. Musk’s pay because he enabled unimaginable growth relative to competitors. The court called this a “hard sell” because executives at rival companies perform the “same task” as Mr. Musk.

Read more at The Wall Street Journal