Elon Musk’s billionaire bill fans draw progressive challengers in Delaware

A progressive wing of the Democratic Party in Delaware is supporting the primary opponents of six outgoing Democratic state lawmakers who pushed for changes to the state’s corporate law that benefit executives and billionaires including Elon Musk and Mark Zuckerberg, who have faced shareholder litigation in the state.

The Delaware Working Families Party exclusively told CNBC it is endorsing six Democratic candidates in the primaries against fellow Democratic incumbents who supported SB 21. The measure became law in 2025 and was dubbed the “billionaire bill” by opponents. How did the law change? Companies can use independent directors and other executives to ensure that deals they make will pass muster in court, and this has limited the records that shareholders can obtain from companies when investigating potential wrongdoing.

Before the bill became law, many institutional investors, legal scholars, and shareholder advocates opposed it, arguing that it would disadvantage minority shareholders and allow boards and executives to make decisions based on their own interests rather than those of the broader investor base.

Musk, whose record $56 billion pay package was in legal limbo in Delaware, moved Tesla’s Incorporation out of state during the dispute. Many other businesses considered similar moves, which alarmed state lawmakers, because Delaware, despite being an overwhelmingly Democratic state, has long been seen as a haven for business.

The Working Families Party, which is prominent in New York politics and expanding into other states, said the endorsement is part of its effort to move Delaware “more in the direction of working-class people.”

Carl Stromberg, Delaware state director of the Working Families Party, told CNBC, “We want to make sure people are aware of the impact this bill has had and is going to have on accountability of corporations and was basically giving Elon Musk $55 billion … to gut federal agencies that are saving millions of lives overseas and put a bunch of Delawareans out of a job here at home. Have been.”

Musk last year led the Department of Government Efficiency, or DOGE, an effort to reduce White House spending that gutted several government agencies and laid off large numbers of federal employees.

As CNBC previously reported, a Delaware corporate firm representing Musk had a hand in drafting the bill.

Specifically, WFP is supporting four candidates for the State House of Representatives and two candidates for the State Senate. All are running in primaries against incumbent Democrats.

It is supporting Shane Darby, who is contesting Representative Nnamdi Chukwuocha; Rae Krantz, who is running against Representative Debra Heffernan; Pamela Salaam who is running against Representative Frank Cook; Will Imbrie-Moore on Representative Kim Williams; Adriana Boehm edged out Senator Dan Kruse, and Shay Frisbie in her race against Senator Ray Siegfried.

Musk’s pay package was eventually reinstated by the Delaware Supreme Court. However, the state Supreme Court’s decision did not rely on SB21.

Delaware Democrats who supported the rewrite of corporate law, including Governor Matt Meyer, argued that they did not change the law to allow Musk to be paid.

“The law changed, because when I came in as governor, we had to make sure that our jurisprudence, our corporate law … remained predictable, clear and fair,” Mayer said on CNBC’s “Squawk Box” last year.

The mayor signed the bill after it passed unanimously in the state Senate and the House approved it 32-7.

Delaware’s billionaire-friendly approach differs from what California voters will consider on the November ballot. California’s Billionaire Tax Act would impose a 5% flat tax on the net worth of California tax residents who have a net worth of $1 billion or more. Unlike Delaware, which addressed corporate domicile, California’s proposal would address individual residence.

— cnbc Lora Kolodny Contributed to this article.