Bad news for Elon Musk as former Twitter CEO Parag Agrawal gets court permission to sue Musk for…

A lawsuit has been filed against Elon Musk by former Twitter execs, including ex-CEO Parag Agrawal, ex-CFO Ned Segal, ex-legal and policy chief Vijaya Gadde, and Twitter’s former general counsel Sean Edgett.

In a major setback for Elon Musk– the world’s richest person– a district court in California, United States, has allowed former Twitter executives, including former CEO Parag Agrawal, to sue the SpaceX CEO over severance pay. According to a report by Bloomberg, a California district court judge, ruled that the dismissed Twitter executives can sue Musk for cheating them of their severance pay when he fired them during his 2022 acquisition of the micro-blogging platform, without giving them a chance to resign.

A lawsuit has been filed against Elon Musk by former Twitter execs, including ex-CEO Parag Agrawal, ex-CFO Ned Segal, ex-legal and policy chief Vijaya Gadde, and Twitter’s former general counsel Sean Edgett.

Musk, who acquired Twitter in a publicised buy-out in 2022 and then rebranded the platform as ‘X’, is being accused of cheating former executives of their severance pay, by firing them before they could resign.

What’s the ‘200 million differential’?

In their March 2024 complaint against Elon Musk, the former Twitter executives, claim the billionaire owes them severance benefits worth a year’s salary plus unvested stock awards valued at the price of the company’s acquisition.

The execs in their lawsuit – Agrawal v. Musk, 24-cv-01304, in US District Court, Northern District of California (San Francisco)– have cited Walter Isaacson’s biography of Elon Musk, in which the Tesla founder states there was a “200 million differential in the cookie jar between closing tonight and doing it tomorrow morning” while referring to the rushed $44 billion acquisition of Twitter.

X representatives have not responded to the accusations leveled against Musk in the lawsuit.

Musk facing several lawsuits

Elon Musk, who fired a major chunk of Twitter employees after his acquisition, is facing several lawsuits from former executives who have claimed their termination was illegal and aimed to cheat them.

Two other lawsuits by  Twitter executives, including one by Twitter’s former core tech general manager Nicholas Caldwell, are currently filed in the US District Court in Northern California, being overseen by Judge Chesney. Caldwell is seeking $20 million in severance compensation.

In his November 1 ruling, Judge Chesney also turned down a request by Musk’s lawyers to dismiss Caldwell’s claims. Earlier this year, in July, Musk and X successfully fought off a $500 million suit by around 6,000 laid-off employees.

Notably, last month, one former Twitter employee won unpaid severance pay through closed-door arbitration, which has set a precedent for other cases of similar nature, Bloomberg quoted lawyers as saying.