Home » Business News • US business news • US Employment News » Elon Musk And X Sued Over $200 Million In Unpaid Severance

Elon Musk And X Sued Over $200 Million In Unpaid Severance

By Nithya Bose in Business News, posted April 4, 2024

Former Twitter executive Nick Caldwell has sued Elon Musk and X for alleged contract breach.

The lawsuit, filed in a federal court in California, claims the company failed to dispense severance and benefits after he resigned in 2022.

The suit alleges the company has “cheated Mr. Caldwell and other executives out of a combined $200,000,000 in severance benefits by falsely accusing them of misconduct and purporting to fire them for ‘Cause.’”

This case mirrors a previous lawsuit by former Twitter executives, including ex-CEO Parag Agrawal, who say they are owed $128 million in unpaid severance.

Caldwell is now serving as Peloton's chief product officer and previously managed Twitter's core technology team.

He played a pivotal role in talent retention until the company's acquisition.

The complaint details Caldwell's efforts to resign "for good reason" shortly after Musk's high-profile takeover, highlighted by Musk's tweet about entering Twitter's headquarters.

Caldwell's attorneys said Twitter accepted Caldwell's resignation.

This triggered a “Twitter Change of Control and Involuntary Termination Protection Policy” for executives exiting in good standing.

Need Career Advice? Get employment skills advice at all levels of your career

However, he claims his access to company systems was promptly revoked, and communications ceased.

By the end of his designated employment period, Twitter accused Caldwell of being terminated for cause, a move his lawyers argue was unjustified and intended to avoid severance payments.

The lawsuit also implicates several people associated with Musk's other ventures, SpaceX and Tesla.

It accuses them of contributing to the denial of severance claims.

Caldwell seeks approximately $19.3 million in severance.

He also wants additional compensation for restricted stock units, interest, and legal fees.

Follow us on YouTube, X, LinkedIn, and Facebook