Elon Musk’s acquisition of Twitter has brought the platform into the spotlight of numerous legal disputes, particularly concerning the treatment of former employees. One significant case involved a class-action lawsuit filed by Courtney McMillian, a former Twitter employee, alleging that Musk’s takeover led to inadequate severance payments for over 6,000 laid-off workers.
The plaintiffs argued that under federal law (ERISA), they were entitled to three months of pay as severance but received less.
In a recent development, US District Judge Trina Thompson ruled in Musk’s favor, dismissing the class-action complaint. Judge Thompson determined that the severance plan implemented by Twitter did not fall under ERISA guidelines, as the employees had been informed of an alternative payout arrangement before their termination.
Elon Musk
This decision effectively halted the lawsuit seeking $500 million in unpaid severance, emphasizing that the post-acquisition severance plan was what legally applied.
Despite this setback, the court’s ruling left open avenues for the plaintiffs to pursue other legal claims. Judge Thompson indicated that the plaintiffs could amend their complaint to pursue non-ERISA claims, potentially linking their case with ongoing litigation against X Corp/Twitter.
This flexibility suggests that while the immediate lawsuit was dismissed, future legal actions could still seek redress for the dismissed Twitter employees.
The ruling marks a significant legal victory for Elon Musk in his handling of Twitter’s restructuring following the acquisition. However, it also sets the stage for further legal battles where former employees may seek larger settlements, including disputes over unpaid severance and legal fees, highlighting ongoing tensions over corporate responsibility and employee rights in the tech industry.
