Elon Musk’s record-setting Tesla pay package was again rejected by a US judge even after shareholders supported reinstating it, dealing a major blow to the world’s richest man.

Despite the shareholder vote on June 13 at the company’s annual meeting, a Delaware Chancery Court judge decided to stick with her original finding in January that the company’s board was too much under the influence of the billionaire entrepreneur when it adopted the plan in 2018.

The stock options package was initially worth $US2.6 billion ($4 billion) and spiked to $US56 billion by the time the judge cancelled it. The package was worth $US101.5 billion at Monday’s closing price.

Chancellor Kathaleen McCormick’s ruling, striking down the highest-ever pay arrangement for a US corporate executive, could take a giant bite out of Mr Musk’s wealth and put the fate of his companies in question if it stands up on appeal.

Even without the payout, the Tesla CEO remains the world’s richest person.