Post by : Rameen Ariff

Elon Musk and X Corp., the company formerly known as Twitter, have reached a settlement in a $128 million lawsuit filed by former CEO Parag Agrawal and three other top executives who claimed they were denied severance payments after being dismissed following Musk’s takeover.

The terms of the agreement were not disclosed in a federal court filing on September 30, which also postponed upcoming case deadlines and a scheduled hearing in San Francisco. According to a lawyer representing the executives, “The parties have reached a settlement and the settlement requires certain conditions to be met in the near term.”

This settlement follows another major resolution earlier this year, when Musk and X Corp. agreed to settle a $500 million lawsuit filed by roughly 6,000 rank-and-file employees. That lawsuit alleged that the billionaire had failed to provide severance payments to many workers after taking over the platform in 2022.

Musk’s acquisition of Twitter, now X, was finalized in 2022 for $44 billion, after an initial attempt to back out of the deal was blocked by a Delaware judge. Immediately after taking control, Musk dismissed several top executives, including Agrawal, Vijaya Gadde, Twitter’s former chief legal officer, Ned Segal, former CFO, and Sean Edgett, the former general counsel, who now works for Match Group.

The lawsuit highlighted ongoing disputes over executive severance and workplace policies at Twitter under Musk’s leadership. Multiple legal actions have accused the company of labor and workplace violations, including failure to pay severance to laid-off employees.

In a related development, a Delaware federal judge recently dismissed part of a class-action lawsuit by former Twitter employees claiming wage theft, ruling that Musk could not be held personally liable as an “alter ego” of the company.

The California case, formally titled Agrawal v. Musk, 24-cv-01304, is being heard in the U.S. District Court for the Northern District of California. Representatives for Musk and X Corp. have not responded to requests for comment, and lawyers for the former executives also declined to provide additional details on the settlement.

The resolution of this high-profile lawsuit underscores the continued legal and financial challenges faced by Musk and X Corp., even years after the dramatic and closely watched acquisition of one of the world’s most influential social media platforms.

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