Musk’s Legal Woes Escalate as Judge Rules Against Him in Twitter Severance Dispute
Tesla and SpaceX CEO Elon Musk has suffered a significant setback in his legal battle against Twitter executives over severance pay claims. On Friday, U.S. District Judge Maxine Chesney delivered a ruling that allows former Twitter CEO Parag Agrawal and other top executives to proceed with their claims.
The Allegations
The executives accuse Musk of strategically firing them to avoid paying severance during the acquisition of Twitter in October 2022. They claim they are owed severance benefits equal to one year’s salary plus unvested stock awards valued at the acquisition price. The complaint, filed in March, references a quote from Musk in Walter Isaacson’s biography, suggesting a $200 million difference in severance payments if the deal closed a day earlier.
A Pattern of Legal Challenges
Since acquiring Twitter for $44 billion and rebranding it as X Corp, Musk has faced numerous legal claims for back pay by thousands of Twitter employees he laid off. Earlier this year, one former employee was awarded unpaid severance in a closed-door arbitration. Judge Chesney is also overseeing two other suits brought by Twitter executives, including one by Nicholas Caldwell, who is seeking $20 million for lost severance.
Musk’s Request Denied
On Friday, Musk’s request to dismiss Caldwell’s claim was denied. This ruling comes on the heels of a previous lawsuit seeking $500 million in severance pay for thousands of employees laid off after the acquisition, which Musk and X Corp successfully defended in July.
X Corp’s Troubles Mount
However, the company has been hit with a new wave of layoffs, particularly in the engineering department. Moreover, the value of X has come under scrutiny, with Fidelity valuing the platform below $10 billion in October, a significant drop from the amount Musk paid for the acquisition.
Implications and Uncertainty
The outcome of these legal battles will have significant implications for Musk, X Corp, and the thousands of employees affected by the acquisition. As the company navigates these challenges, one thing is clear: Musk’s gamble on Twitter may have backfired, and the consequences are far from over.
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