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Elon Musk and X Corp have reached a confidential settlement with four of Twitter’s former top executives who claimed they were denied $128million in promised severance pay following Musk’s $44billion acquisition of the platform in 2022.
A recent filing in the San Francisco federal court confirmed that both sides have agreed to settle. The terms of the agreement were not disclosed, and a federal judge has delayed hearings and filing deadlines to allow time for the settlement to be finalized.
The lawsuit was brought by former CEO Parag Agrawal, former Chief Financial Officer Ned Segal, former Chief Legal Officer Vijaya Gadde, and former General Counsel Sean Edgett. The four alleged that Musk falsely accused them of misconduct and terminated them without cause immediately after taking control of the company, then withheld their severance and stock-based compensation.
Severance lawsuits pile up for Musk’s X Corp
The executives said they were contractually entitled to one year’s salary and substantial stock options, claiming those agreements were in place long before Musk’s takeover. In court filings, Musk and X Corp denied any wrongdoing, arguing that the executives were dismissed for performance-related reasons.
This case follows another major legal dispute for X. In August, the company agreed to settle a separate lawsuit filed by rank-and-file employees affected by mass layoffs, who claimed they were collectively owed $500 million in unpaid severance.
Both cases are part of a growing list of legal and financial challenges Musk has faced since taking over the platform, cutting more than half its workforce, and rebranding it as X.
Musk’s leadership has been marked by sweeping restructuring initiatives and public controversy. The lawsuits from former staff, ranging from top executives to hourly employees, reveal the ongoing friction between Musk’s aggressive cost-cutting approach and pre-existing employment agreements at the company.
Another chapter closes in Musk’s Twitter overhaul
For Agrawal and his fellow plaintiffs, the settlement concludes a lengthy legal battle that began when Musk sought to walk away from his purchase of Twitter. The executives had sued to force him to honor the $44billion deal. Once it closed, they were swiftly dismissed, setting the stage for the severance fight that followed.
Neither X Corp nor attorneys for the former executives have commented on the settlement. But with both the executive and employee lawsuits now resolved, Musk’s company appears to be closing off some of the most prominent legal disputes tied to the acquisition.
Whether the settlements bring stability to X remains to be seen. What’s clear is that the takeover continues to leave legal and cultural ripples across the company formerly known as Twitter.
