Dynamite News Former Twitter executives sue Elon Musk for USD128 million in severance payments
Former top Twitter executives, including Parag Agrawal, have sued Elon Musk, claiming the Tesla CEO had withheld USD128 million in severance payments after the billionaire took over the social media company in 2022 and dismissed them, according to The New York Times. Read further on Dynamite News:
New York [US]: Former top Twitter executives, including Parag Agrawal, have sued Elon Musk, claiming the Tesla CEO had withheld USD128 million in severance payments after the billionaire took over the social media company in 2022 and dismissed them, according to The New York Times.
After paying USD44 billion to acquire Twitter, Musk sacked the company's chief executive, Parag Agrawal; chief financial officer, Ned Segal; head of legal and policy, Vijaya Gadde; and general counsel, Sean Edgett.
The Twitter was later renamed as X by Musk.
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The lawsuit, which was filed in the US District Court for the Northern District of California on Monday, claimed that because the executives' contracts stated they would receive severance payments if Twitter was taken private by Musk in October 2022, they were entitled to the payments.
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Agrawal's offer letter for the position said that he would get a USD1 million annual salary in addition to USD12.5 million in shares, The New York Times reported.
According to a Twitter securities filing, Agrawal was entitled to a so-called golden parachute payment of USD60 million in the case of an involuntary termination. According to the document, Segal would receive USD46 million and Gadde would receive USD21 million in the identical circumstances.
Musk claimed he could fire the executives "for cause" at the time of the takeover in order to avoid having to pay them severance.
In order to save himself roughly USD200 million, Musk informed Walter Isaacson, his biographer, that he would refuse the executives' severance benefits. He vowed to "hunt" the executives "till the day they die" in front of Isaacson, according to The New York Times.
"This is the Musk playbook: to keep the money he owes other people, and force them to sue him. Even in defeat, Musk can impose delay, hassle and expense on others less able to afford it," the lawyers for the executives wrote in court documents, according to The New York Times.
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The executives previously sued Musk for legal fees they incurred while responding to investigations into the company.
In October, a Delaware judge ordered Musk to pay them USD1.1 million to cover those expenses.
After closing the USD 44 billion acquisition deal, Elon Musk has started to reform the policies of the micro-blogging platform and is wasting no time remodelling it by dismissing employees, The Hill earlier reported.
In one of the first few changes, he purged the top executives of the company as soon as he closed the deal in which Twitter CEO Parag Agrawal and finance chief Ned Segal left the company's San Francisco headquarters. (ANI)