Elon Musk sued by former Twitter executives over $128m unpaid severance

Four former Twitter leaders accuse Elon Musk of flouting the law and not paying Twitter’s debts.
Elon Musk sued by former Twitter executives over $128m unpaid severance
Elon Musk in January 2024 at a conference in PolanGetty Images

Elon Musk is facing a lawsuit from Twitter’s former top brass, who say he owes them more than $128m (£100m) in unpaid severance.

The four executives, including former chief Parag Agrawal, said Mr Musk fired them as he took over Twitter, now X, “without reason, then made up fake cause” to avoid handing over the money.

They said the move was part of a “larger pattern” of refusing to pay former staff what they were due.

Mr Musk did not immediately comment.

Mr Agrawal filed the lawsuit with former chief financial officer Ned Segal, former chief legal officer Vijaya Gadde and former general counsel Sean Edgett.

In the lawsuit, they contend that under a years-old severance plan they are owed one year’s salary and stock awards. That would total more than $57m for Mr Agrawal; more than $44m for Mr Segal; more than $20m for Ms Gadde; and more than $6m for Mr Edgett.

Mr Musk purchased Twitter in 2022 for $44bn. The billionaire attempted to get out of the acquisition, but he eventually went ahead with the contentious agreement under threat of a lawsuit.

He then moved within minutes of the deal closing to fire key leaders, which included the four executives.

According to the lawsuit, the four men were told they had been sacked for “gross negligence and willful misconduct”. Examples that were given included signing off on retention bonuses for Twitter employees, thousands of whom were also fired in the wake of the takeover.

But the lawsuit alleges Mr Musk was angry about being forced to complete the purchase. It further claims he has attempted to avoid paying the millions he owed the leaders, dismissing the severance plans that laid out compensation if the executives lost their jobs without cause.

The two sides have been fighting over the money ever since and have now exhausted the administrative process, the lawsuit said.

X has previously said staff were paid in full. Mr Musk’s attorney, Alex Spiro, did not respond to a request from the BBC for comment.

In the lawsuit, however, the executives accused Mr Musk of turning the company into an entity that flouts the law and does not pay its debts.

“Musk doesn’t pay his bills, believes the rules don’t apply to him, and uses his wealth and power to run roughshod over anyone who disagrees with him,” according to the filing in federal court in California.

Last year, a former human resources officer at the platform filed a class action lawsuit accusing the company of failing to pay roughly $500m (£385m) in severance pay owed to former staff.

The roughly 20 people working for the company in Ghana at the time of the takeover, which took place roughly 16 months ago, told the BBC in February that they had only recently received the money they were due.

The four executives’ lawsuit has attempted to paint Mr Musk as an individual who avoids paying his debts and treats his employees poorly.

“Musk’s refusal to pay … is part of a larger pattern of refusing to pay Twitter’s former employees the benefits and other compensation they are due,” Mr Agrawal and his former colleagues alleged in the lawsuit.

Source: bbc.co.uk

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