Four former senior executives of Twitter, now rebranded as X Corp., have initiated a lawsuit against billionaire entrepreneur Elon Musk. The plaintiffs are seeking over $128 million in unpaid severance payments following their dismissals in the wake of Musk’s acquisition of the social media giant in October 2022.
The lawsuit is filed in U.S. District Court for the Northern District of California by Twitter’s former chief executive officer Parag Agrawal, former chief financial officer Ned Segal, former chief legal officer Vijaya Gadde, and former general counsel Sean Edgett. It alleges that Musk, in an attempt to avoid severance payouts, fabricated reasons to terminate their contracts on the very day he finalized the Twitter purchase. The plaintiffs assert that Musk’s actions are part of a broader pattern of evading financial obligations, pointing to numerous other lawsuits filed by former Twitter employees over severance disputes.
“Because Musk decided he didn’t want to pay Plaintiffs’ severance benefits, he simply fired them without reason, then made up fake cause and appointed employees of his various companies to uphold his decision. He claimed in his termination letters that each Plaintiff committed “gross negligence” and “willful misconduct” without citing a single fact in support of this claim,” according to the filed lawsuit. “This is the Musk playbook: to keep the money he owes other people, and force them to sue him,” it stated.
According to the complaint, Musk’s refusal to honor severance agreements—purportedly entitling each executive to a year’s salary plus unvested stock awards at the acquisition price—is symptomatic of a disregard for legal and financial commitments. A report by the New York Times, citing Twitter’s SEC filing, highlighted that in an event of involuntary termination former CEO Agarwal was entitled to a so-called golden parachute payment of $60 million, while former CFO Segal would receive $46 million and former CLO Gadde $21 million.
Musk and social media platform X Corp. have yet to respond to the allegations. Meanwhile, this legal confrontation adds to a growing list of disputes involving X Corp. (formerly Twitter) since Musk’s takeover, including proposed class actions and claims for unpaid severance amounting to hundreds of millions of dollars.
