Judge said court lacked jurisdiction for case, in which workers argued they didn’t receive proper compensation
A worker dismantles a Twitter sign in San Francisco after Elon Musk renamed the company X, on 24 July 2023.A worker dismantles a Twitter sign in San Francisco after Elon Musk renamed the company X, on 24 July 2023.US district judge Trina Thompson in San Francisco ruled on Tuesday that the federal Employee Retirement Income Security Act governing benefit plans did not cover the former employees’ claims, and therefore she lacked jurisdiction.
The decision marks a legal victory for Musk, who still faces numerous lawsuits over his business practices at companies includingThe case is one of many accusing Musk of reneging on promises to former Twitter employees, including former chief executive Parag Agrawal, and vendors after he bought the company for $44bn in October 2022.
Lawyers for the plaintiffs did not immediately respond to requests for comment on Wednesday. Musk’s lawyers did not immediately respond to similar requests. Musk, one of the richest people in the world, was accused of failing to pay Twitter employees appropriate severance after claiming to have fired about 80% of the company in the months after his takeover. Plaintiffs alleged employees received only one month of severance pay with no benefits, instead of the far more generous package they were entitled to as part of a 2019 severance plan.
Thompson said Erisa didn’t apply to Twitter’s post-buyout plan because there was no “ongoing administrative scheme” in which the company reviewed claims on a case-by-case basis, or offered benefits such as continued health insurance and outplacement services.Musk’s lawyers were also in court this week for the latest legal battle over his contested multibillion-dollar pay package as CEO of Tesla.
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