In a rather bold move that reads like a Silicon Valley soap opera, a group of Twitter’s former top brass are dragging Elon Musk and his rebranded venture, X Corp., to court over what they claim is a whopping $128 million in unpaid severance dough.
Leading the charge are Twitter’s ex-CEO Parag Agrawal, the former CFO Ned Segal, the erstwhile Chief Legal Counsel Vijaya Gadde, and General Counsel Sean Edgett. They’re not mincing words in their legal battle, launched with some fanfare on a Monday, over their abrupt firing. According to the fired executives, the salaries owed are divided as follows:
- Agrawal is owed over $57 million.
- Segal is owed over $44 million.
- Gadde is owed $20 million.
- Edgett is owed over $6 million.
The individuals who filed a lawsuit on Monday allege they were terminated from their jobs without justifiable reason on the same day Musk acquired Twitter. It’s worth noting that Musk later changed the platform’s name to X.
The Plaintiffs claim that Musk employed a cunning tactic to avoid paying out the severance pay he had promised. They assert that Musk fabricated a ’cause’ to fire them and even convinced his company’s staff to support his decision. The allegations suggest that Musk’s action was deliberate and calculated, aimed at depriving the former employees of their rightful compensation.
Digging deeper, the lawsuit paints a broader picture of Musk’s modus operandi, suggesting a chronic reluctance to settle accounts. This, they argue, is evidenced by a growing line of former employees left high and dry without severance after Musk wielded the axe, thinning the ranks by the thousands.
They claim that Musk refused to pay their severance, and to support his decision, he “made up the fake cause and appointed employees of his various companies to uphold his decision.”
The legal document doesn’t hold back, casting Musk’s reign over Twitter as a lawless spree of dodging financial responsibilities, from employee paychecks to rent and vendor dues. It boldly accuses Musk of flouting rules with impunity, leveraging his wealth and clout to bulldoze any opposition. “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.”
At the heart of the ex-executive’s claims is that their severance package promised them a year’s salary plus the cherry on top: unvested stock awards, all pegged to Twitter’s acquisition price. Musk’s $44 billion takeover, translating to $54.20 per share, is now contentious.
The lawsuit challenges the grounds of their firing, contending they were shown the door without a valid cause. They argue that Musk’s reasons were far-fetched, centering on accusations of “gross negligence and willful misconduct” tied to legal fees paid out for the acquisition’s closure—a move they defend as fulfilling their duty to the company. According to the executives, they were required to pay the fees to fulfill their fiduciary responsibilities.
Moreover, they point out Musk’s seemingly nonchalant attitude towards a growing avalanche of lawsuits over unpaid bills, adopting a ‘let them sue’ stance, which they claim underscores his disregard for financial commitments. “This is the Musk playbook: to keep the money he owes other people and force them to sue him,” Agrawal alleges in his complaint.
The lawsuit states that X faces a “staggering” number of lawsuits over unpaid bills. According to the Hollywood Reporter, this particular lawsuit is expected to be the 30th against X, formerly known as Twitter, over refusal to pay. “This is the Musk playbook: to keep the money he owes other people and force them to sue him,” states the complaint from Agrawal
This legal drama, unfolding in the Northern District of California’s federal court, promises to be a spectacle, pitting Silicon Valley’s elite against one of its most controversial figures.
