A lawsuit has been filed against Twitter by three of its former executives who were fired by Elon Musk on his first day as CEO. The lawsuit was filed on April 10th in Delaware Chancery Court. It is seeking over $1 million in unpaid legal bills. The former executives, former CEO Parag Agrawal, former CFO Ned Segal, and former head of legal and policy Vijaya Gadde, incurred significant personal legal expenses related to government investigations, such as those by the Department of Justice, inquiries by the Securities and Exchange Commission (SEC), and shareholder lawsuits.
According to the lawsuit, the executives have been waiting for more than two months for Twitter to reimburse them for their expenses. However, the company has refused to acknowledge its obligations and pay any invoices. Twitter’s corporate bylaws and contracts with former executives require it to pay its legal fees in matters related to the social media company.
Agrawal and Segal were contacted by federal authorities in July while still in their roles at Twitter and in September, the SEC asked Agrawal to preserve documents. The SEC has been investigating whether Musk breached securities regulations by failing to make timely disclosures when he bought a 9.2% stake in Twitter early last year. This issue has seen Elon apologize publicly to an employee.
The trio of executives was fired “for cause” by Musk last year, voiding the large severance payouts they were expected to receive, which would have amounted to nearly $60 million for Agrawal.
Since taking over Twitter, Musk has aggressively cut costs, firing over 75% of its 7,500 employees. The former executives allege that Twitter has failed to honour its contractual obligations to pay its bills. Twitter has not commented on the lawsuit.
cc: The Guardian
