Elon Musk Loses Legal Battle To Former Twitter Employee: What It Was About

Elon Musk has lost a legal fight concerning unpaid severance to a former Twitter (now X) employee, who was laid off following the billionaire's acquisition of the platform in 2022. The case, resolved through arbitration, is a significant development for thousands of ex-employees with similar grievances.

According to a memo obtained by Bloomberg, the dispute's resolution comes nearly two years after Elon Musk bought Twitter for $44 billion and subsequently laid off more than half of the company's workforce. Over 2,000 former employees filed complaints, alleging they had not received adequate severance pay. 

“The arbitrator awarded the full severance package to our client,” said lawyer Shannon Liss-Riordan in the memo. “We are excited about this development and hope it foreshadows more good news to come.” The lawyer did not comment further or share any details regarding the arbitrator's ruling because the proceedings were private. 

This legal loss follows a separate case in July, where Elon Musk's company managed to defeat a lawsuit that alleged over $500 million in severance was owed to around 6,000 employees under the federal Employee Retirement Income Security Act. 

Lawyer Liss-Riordan revealed that 15 cases had gone through arbitration hearings, and she expects additional rulings in the coming months. “It is our hope that if more rulings come down our way, Twitter/X will be willing to come to the table and negotiate a settlement for everyone,” she added.

Meanwhile, Elon Musk's X is facing another legal battle in Brazil, where the Supreme Court ordered the platform to suspend service or face a daily fine of over $900,000. The company was banned last month, but access was restored briefly, which the Brazilian government called a deliberate violation of the court order. X defended the restoration as “inadvertent and temporary,” but the court was unconvinced.

Brazilian Supreme Court Judge Alexandre de Moraes slammed X for “unlawfully, persistently and intentionally” failing to comply with judicial orders. In response, the court imposed a daily fine and ordered the telecommunications agency Anatel to ensure the platform's suspension.

X has since also appointed a new legal representative, Rachel de Oliveira Conceicao, in compliance with local laws. The firm had lost its legal standing in Brazil in August when it closed its offices in the country, leading the court to enforce a suspension of its services.