Nov 02, 2024 12:27 PM IST
Elon Musk loses authorized bid to evade severance funds to former Twitter executives.
Elon Musk faces a authorized setback in his try to keep away from severance funds to Twitter’s former high executives, fired throughout his 2022 takeover of the corporate. On Friday, a decide dominated that former CEO Parag Agrawal, together with different high executives, can proceed with their claims that Elon Musk terminated them proper because the deal closed to keep away from paying severance.
Decide guidelines in opposition to Elon Musk in Twitter executives’ severance claims
In a lawsuit filed in March, the executives argued that Musk deliberately lower them off earlier than they may formally resign, denying them agreed-upon compensation. The swimsuit additionally referenced an announcement Musk made to biographer Walter Isaacson, revealing that Musk was keen to shut the deal to keep away from “a $200 million differential in the cookie jar between closing tonight and doing it tomorrow morning.”
Agrawal is joined within the case by Vijaya Gadde, Twitter’s former authorized chief; Ned Segal, former CFO; and Sean Edgett, former basic counsel, who all allege that they’re owed one yr’s wage plus unvested inventory awards valued on the acquisition value.
Elon Musk faces a number of authorized battles
This isn’t Musk’s first authorized battle over worker compensation. After shopping for Twitter, which he rebranded as X Corp., Musk laid off hundreds of workers as a part of a large restructuring. A lot of these staff have filed claims for unpaid severance, alleging that Musk didn’t honour compensation phrases.
In July, Musk and X Corp. gained a class-action lawsuit the place laid-off staff sought $500 million in severance beneath the Worker Retirement Earnings Safety Act. Nonetheless, in September, a former worker was awarded unpaid severance in a personal arbitration session, doubtlessly setting a precedent for comparable instances.
US District Decide Maxine Chesney, overseeing the executives’ case, additionally denied Musk’s request to dismiss an analogous declare filed by former “core tech” basic supervisor Nicholas Caldwell, who’s looking for $20 million in compensation for misplaced severance.
(Inputs from Bloomberg)
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