In a dramatic turn of events, former Twitter CEO Parag Agrawal 3 Other Employees Sue Elon Musk, sought $128 million in compensation. The lawsuit, filed in the U.S. District Court for the Northern District of California, alleges that Musk violated federal labor laws and failed to provide promised compensation after acquiring the social media platform.
The plaintiffs in the case are Parag Agrawal, former Twitter CEO; Bjoern Erich, former Chief Technology Officer; Manu Ahuja, former Chief Financial Officer; and Micheal Montano, former Head of Design at Twitter. According to the lawsuit, these employees were promised lucrative compensation packages and stock awards before Musk’s $44 billion takeover of Twitter in October 2022.
“Elon Musk and his companies, in violation of federal labor laws, have refused to pay the former Twitter employees the compensation they were promised and owed,” said Shannon Liss-Riordan, the attorney representing the plaintiffs. “These employees had legally binding agreements, approved by Twitter’s board of directors, that entitled them to millions of dollars in compensation after the Musk acquisition.”
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The lawsuit alleges that Musk and his companies, including X Corp. (formerly known as Twitter Inc.), have failed to honor the compensation agreements made with the former Twitter employees. According to the plaintiffs, Musk’s actions violate the Worker Adjustment and Retraining Notification (WARN) Act, which requires companies to provide advance notice of mass layoffs and plant closings.
“Parag Agrawal and the other plaintiffs devoted years of their lives to Twitter, helping to build and grow the company,” said Liss-Riordan. “They are owed the compensation they were promised and are entitled to under their contracts.”
Parag Agrawal, who served as Twitter’s CEO from November 2021 until Musk’s acquisition, is seeking $38.7 million in compensation, according to the lawsuit. Bjoern Erich, the former Chief Technology Officer, is seeking $30.4 million, while Manu Ahuja, the former Chief Financial Officer, is seeking $22.2 million. Micheal Montano, the former Head of Design, is seeking $37.4 million.
“These employees had legally binding agreements, approved by Twitter’s board of directors, that entitled them to millions of dollars in compensation after the Musk acquisition,” said Shannon Liss-Riordan, the attorney representing the plaintiffs.
The lawsuit also alleges that Musk and his companies have failed to provide the required 60-day notice of termination or pay instead of notice, as mandated by the WARN Act. The plaintiffs claim that they were terminated without proper notice or compensation, in violation of federal labor laws.
“Elon Musk and his companies have shown a blatant disregard for the rights of their employees and the laws that protect them,” said Liss-Riordan. “We intend to hold them accountable for their actions and ensure that these former Twitter employees receive the compensation they are owed.”
Musk’s acquisition of Twitter has been marred by controversy and legal battles. Shortly after taking over the company, Musk laid off approximately half of Twitter’s workforce, citing the need to cut costs and streamline operations. However, the sudden layoffs sparked criticism and legal challenges from former employees.
The lawsuit filed by Agrawal and the other former Twitter employees is just the latest legal challenge facing Musk and his companies. In addition to the compensation dispute, Musk is also facing lawsuits related to his Twitter acquisition and allegations of mass layoffs without proper notice or compensation.
“These employees had legally binding agreements, approved by Twitter’s board of directors, that entitled them to millions of dollars in compensation after the Musk acquisition,” said Shannon Liss-Riordan, the attorney representing the plaintiffs.
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Musk has not yet publicly commented on the latest lawsuit, but his legal team is expected to mount a vigorous defense against the claims made by the former Twitter employees. The case could have far-reaching implications for employee compensation and whistleblower protection in the technology industry.
As the legal battle unfolds, it will be closely watched by employees, investors, and legal experts alike. The outcome of the case could set important precedents for how companies handle compensation agreements and employee terminations, particularly in the context of high-profile acquisitions and mergers.
“These employees had legally binding agreements, approved by Twitter’s board of directors, that entitled them to millions of dollars in compensation after the Musk acquisition,” said Shannon Liss-Riordan, the attorney representing the plaintiffs.
