Elon Musk Wins Dismissal of Twitter Severance Lawsuit

Elon Musk successfully won the dismissal of a lawsuit alleging that he refused to pay $500 million in severance to thousands of Twitter employees affected by mass layoffs. U.S. District Judge Trina Thompson ruled that the claims were not governed by the Employee Retirement Income Security Act (ERISA), meaning she lacked jurisdiction. The case originated after Musk's acquisition of Twitter, now called X, in October 2022.

Elon Musk secured a legal win on Tuesday when a federal judge dismissed a lawsuit claiming he failed to pay at least $500 million in severance to thousands of Twitter employees laid off after his acquisition of the social media platform, now known as X. U.S. District Judge Trina Thompson in San Francisco ruled that the federal Employee Retirement Income Security Act did not cover the employees' claims, thus she lacked jurisdiction over the case.

The lawsuit is one of many accusing Musk of reneging on agreements with former Twitter employees and vendors following his $44 billion purchase of the company in October 2022. Musk, who also leads Tesla and is ranked the world's richest person by Forbes, has faced multiple legal challenges during his tenure at Twitter.

Sanford Heisler Sharp, representing the former employees, expressed disappointment and stated they are considering further legal options. Lawyers for Musk and Twitter did not immediately comment. According to the complaint, Twitter had promised severance of two to six months' pay plus additional benefits, but instead offered only one month of pay with no added benefits. Judge Thompson noted that ERISA did not apply to Twitter's severance plan as it lacked an ongoing administrative scheme, advising the plaintiffs to amend their complaint for non-ERISA claims.