WASHINGTON (dpa-AFX) - Elon Musk's social media company, X Corp, has reached a tentative settlement in a high-profile lawsuit brought by former Twitter employees who claimed they were denied $500 million in severance pay.
The agreement was disclosed in a Wednesday filing, with both parties requesting the 9th U.S. Court of Appeals in San Francisco to postpone an upcoming hearing while final terms are finalized. Financial details of the deal remain under wraps and will require court approval.
The legal battle traces back to Musk's 2022 acquisition of Twitter, now rebranded X, which triggered the dismissal of roughly 6,000 employees over half the workforce. Plaintiffs argued that under
Twitter's 2019 severance plan, laid-off staff were entitled to two months' base salary plus an additional week for every year of service, while senior leaders such as benefits chief Courtney McMillian were eligible for up to six months of pay. Instead, most employees received at most one month's compensation, while many were given nothing.
The case, led by McMillian and operations manager Ronald Cooper, was initially dismissed by a federal judge in San Francisco in July 2024 before being appealed. The 9th Circuit had scheduled oral arguments for September 17.
Twitter's mass layoffs marked one of the earliest and most sweeping job cuts in the technology sector's recent wave of downsizing, later mirrored by companies including Meta, Google, and Microsoft.
Musk's aggressive cost-cutting dismantled entire teams dedicated to trust and safety, human rights, and media operations. If finalized, the settlement would close one of Silicon Valley's most significant legal disputes over severance benefits.
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