San Francisco, California – Former senior executives of Twitter are taking legal action against Elon Musk and X Corp., claiming they are owed over $128 million in unpaid severance payments. The lawsuit, filed in federal court in the Northern District of California, alleges that Twitter’s former CEO Parag Agrawal, CFO Ned Segal, Chief Legal Counsel Vijaya Gadde, and General Counsel Sean Edgett were terminated without cause on the day that Musk finalized his acquisition of Twitter in 2022.
The executives assert that Musk concocted false justifications to avoid paying their severance, appointing employees from his various companies to support his decision. This legal dispute is not an isolated incident, as the lawsuit mentions other former Twitter employees who have sued Musk for failing to provide severance after terminating them.
Under Musk’s ownership, Twitter has been accused of neglecting its financial obligations to employees, landlords, vendors, and others, fostering a culture of noncompliance and disregard for accountability. The lawsuit emphasizes Musk’s alleged pattern of avoiding payments and flouting rules, leveraging his wealth and influence to impose his will on dissenting parties.
The former executives claim their severance packages entitle them to one year’s salary and unvested stock awards based on Twitter’s acquisition price by Musk. Following the acquisition of Twitter for $44 billion, or $54.20 per share, the executives maintain that they were unfairly dismissed without valid cause, as defined by the severance plans’ specific criteria.
According to the lawsuit, Musk cited “gross negligence and willful misconduct” as reasons for the terminations, particularly due to Twitter’s payment of fees to external lawyers involved in finalizing the acquisition. The executives argue that the fees were necessary to fulfill their fiduciary duties to the company, and Musk’s decision to withhold their severance payments post-acquisition was unjustified.
X Corp. is facing a mounting number of lawsuits related to unpaid debts, with the lawsuit characterizing Musk’s response as dismissive and indifferent, prompting some to sue. The legal battle between the former Twitter executives and Musk exemplifies a larger pattern of alleged financial irresponsibility and disregard for contractual obligations.