Twitter ex-CEO Parag Agrawal, 3 others sue Musk for non-payment

NEW YORK: Twitter’s former leadership team, including ex-CEO Parag Agrawal and Chief Legal Officer Vijaya Gadde, has sued the platform’s owner Elon Musk, saying the billionaire fired them without reason and owes them severance payments worth $128 million.

The lawsuit against the Tesla and SpaceX chief and X Corp was filed in the US District Court, Northern District of California by Agrawal, Gadde, Twitter’s former Chief Financial Officer Ned Segal and General Counsel Sean Edgett.

Musk has a “special ire” toward Agrawal, Segal, Gadde, and Edgett, who in their leadership roles at Twitter “appropriately and vigorously represented the interests of Twitter’s public shareholders throughout Musk’s wrongful attempt to renege on the deal. For their efforts, Musk vowed a lifetime of revenge,” the 38-page lawsuit said.

Agrawal worked at Twitter from 2011 until 2022 and was the platform’s CEO from November 29, 2021, until October 27, 2022, a role he took over from the company’s founder-former CEO Jack Dorsey. The lawsuit also notes as Musk was closing Twitter’s acquisition for $44 billion in 2022, the billionaire told his official biographer Walter Isaacson, that he would “hunt every single one of” Twitter’s executives and directors “till the day they die.”

“These statements were not the mere rantings of a self-centred billionaire surrounded by enablers unwilling to confront him with the legal consequences of his own choices. Musk bragged to Isaacson specifically how he planned to cheat Twitter’s executives out of their severance benefits in order to save himself $200 million,” he said.

The four former Twitter executives claim in the lawsuit that Musk owes them severance payments totalling about $128 million. “Under Musk’s control, Twitter has become a scofflaw, stiffing employees, landlords, vendors, and others. Musk doesn’t pay his bills, believes the rules don’t apply to him, and uses his wealth and power to run roughshod over anyone who disagrees with him,” the lawsuit said.

It said Agrawal is entitled to severance benefits amounting to over $57 million, which is equal to his one-year salary of one million dollars plus restricted stock units, performance share units and other benefits. Gadde is entitled to severance benefits in the amount of $20 million, an amount equal to one year’s salary of $600,000 plus other benefits.

The lawsuit alleges that under Twitter’s severance plans if an eligible executive is terminated without cause following a change in control, they are entitled to severance benefits.

“Because Musk decided he didn’t want to pay Plaintiffs’ severance benefits, he simply fired them without reason, then made up fake cause and appointed employees of his various companies to uphold his decision. He claimed in his termination letters that each Plaintiff committed “gross negligence” and “willful misconduct” without citing a single fact in support of this claim,” the lawsuit said.

The four executives highlighted “the Musk playbook”, which is “to keep the money he owes other people and force them to sue him. Even in defeat, Musk can impose delay, hassle, and expense on others less able to afford it.”

The lawsuit added it would be “inequitable and unjust” to prevent the four plaintiffs from recovering benefits and other remedies from Musk, who is personally responsible for and will individually benefit from the acts of X Corp.