Elon Musk Triumphs as US Judge Dismisses $500M Severance Case: What Happens Next?

San Francisco, CA – A US judge in San Francisco has dismissed a case brought forward by former Twitter employees against billionaire Elon Musk. The former staff had accused Musk of unlawfully denying approximately $500 million in severance payments following his acquisition of the company in 2022.

Judge Trina Thompson ruled that the employees did not provide sufficient evidence that their claims were protected by federal law. This decision marks a victory for Musk, who, after taking over Twitter, initiated significant changes that led to the termination of numerous employees, sparking multiple lawsuits from ex-staff and vendors who alleged that promised payments were withheld.

The lawsuit was filed in 2023 by Courtney McMillian, the former “head of total rewards” at Twitter, which Musk rebranded as X. In the complaint, McMillian stated that employees received only one month’s pay as severance instead of the more generous benefits, including at least two months of salary and contributions towards health insurance, that were promised.

Elon Musk’s legal team argued that the Employee Retirement Income Security Act, which sets standards for private health and pension plans, did not apply as claimed by the plaintiffs. Meanwhile, other cases, including one led by former company leaders, are still undergoing legal proceedings.

In her ruling, Judge Thompson acknowledged the ongoing disputes, suggesting that employees may have other opportunities to substantiate their claims. She indicated that while the Court lacked jurisdiction in this particular case, plaintiffs could pursue other avenues to address issues related to unpaid wages and employee severance benefits during the same period.