Elon Musk wins dismissal of $500M severance suit filed by fired Twitter workers
What was the basis for dismissing the $500M severance suit?
The $500 million severance suit against Elon Musk was dismissed by U.S. District Judge Trina Thompson, who ruled that the ex-Twitter employees' claims were not covered by the federal Employee Retirement Income Security Act (ERISA), which governs benefit plans6. The judge found that Twitter's post-buyout plan did not feature an "ongoing administrative scheme" for processing claims and paying benefits, a requirement for ERISA coverage.
How much did Musk's group pay for Twitter?
Elon Musk's group acquired Twitter for $44 billion. The acquisition came after months of lawsuits, verbal mudslinging, and a near-miss of a full-blown trial3. Musk's equity commitment for the deal included his 9.6% Twitter stake, which is worth $4 billion, and the $7.1 billion he had secured from equity investors, including Oracle Corp co-founder Larry Ellison and Saudi Prince Alwaleed bin Talal4.
What severance were fired Twitter employees initially promised?
Fired Twitter employees were initially promised severance pay under Twitter's severance plan. The plan stated that employees who remained after Elon Musk's acquisition of the company would receive two or six months of pay, plus one week's pay for every year of employment if they were laid off.