(qlmbusinessnews.com Thurs. 11th July, 2024) London, UK —
Musk Wins Court Battle Against Ex-Twitter Employees Seeking $500m Severance.
A US judge has dismissed a lawsuit filed by former Twitter employees who accused billionaire Elon Musk of unlawfully denying them nearly $500 million in severance payments after his takeover of the company.
Judge Trina Thompson ruled that the employees failed to prove their claims were protected under federal law. This decision marks a significant victory for Mr Musk, who purchased Twitter in 2022 and quickly implemented drastic changes, including the dismissal of thousands of staff members.
The layoffs led to several lawsuits from former employees and vendors, who accused the company of reneging on promised payments. The dismissed complaint, filed in 2023 in a federal court in San Francisco by Courtney McMillian, the former “head of total rewards” at the social media company, claimed that staff were given only one month's pay as severance, rather than the more generous benefits they were promised, which included at least two months' salary and contributions towards health insurance.
Mr Musk's legal team argued that the Employee Retirement Income Security Act (ERISA), which sets standards for private health and pension plans in the US, did not apply in this case.
“We are disappointed in the ruling and are considering our options for moving forward,” said a spokesperson for Ms McMillian's team.
Other lawsuits, including one brought by former company executives, are still making their way through the courts. Judge Thompson acknowledged these ongoing disputes in her ruling, suggesting that the plaintiffs might have other avenues to pursue their claims.
“The Court lacks jurisdiction. However, plaintiffs are not without recourse. Indeed, there are other cases brought against Twitter for the failure to pay wages or provide employee severance benefits during the same or overlapping period,” she wrote.
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