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Elon Musk and X/Twitter owe employees $10 Million + · Elon Musk Podcast

• 0:01
  Hey everybody, welcome back to the Elon Musk Podcast.
• 0:05
  This is a show where we discuss the critical crossroads that
• 0:08
  shape SpaceX, Tesla X, The Boring Company, and Neuralink.
• 0:13
  And I'm your host, Will Walden. X, formerly known as Twitter,
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  has been ordered by a federal judge to confront a lawsuit
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  alleging the non payment of millions of dollars in promise
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  bonuses to its employees. Now the case, led by the
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  company's former senior director of compensation, Mark
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  Schrobinger, claims that X Corp breached contracts by not paying
• 0:35
  2022 Target bonuses. Now Schrobinger, who left X Corp
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  in May, initiated legal action against the company in June
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  citing breach of contract. He alleges that both before and
• 0:47
  after Elon Musk's acquisition of Twitter, the company promised to
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  pay employees 50% of their 2022 Target bonuses, a commitment
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  that was never fulfilled. U.S.
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  District Judge Vince Cabria denied X Corp's motion to
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  dismiss the lawsuit, asserting that Schobinger's claim
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  plausibly stated a breach of contract under California law,
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  and the judge emphasized that the commitment made by Twitter
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  to pay bonuses once they met the company's demands became a
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  legally binding contract in California.
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  Now X Corp, which has ceased to operate.
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  A media relations office, did not provide immediate comments
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  on the ruling. The company's lawyers had argued
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  that the oral promise made was not a contract and contended
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  that Texas law should apply to the case.
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  However, the judge affirmed that California law was applicable,
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  dismissing all contrary arguments from X Corp Now the
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  lawsuit, which seeks CLASH XN status, accuses X Corp of
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  failing to honor verbal promises regarding annual bonuses for
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  employees who were part of the company as of January 1st, 2023.
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  Now, this claim, representing thousands of current and former
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  employees, estimates the unpaid bonuses to be in the 10s of
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  millions of dollars. Now the plaintiff's attorney,
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  Shannon Liz Riordan, in a statement to Business Insider,
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  highlighted the substantial amount owed in bonuses,
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  estimating that about a couple of thousand employees would have
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  been eligible and the total amount claimed exceeds 5
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  million. The judge's dismissal of X
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  Corp's lawyers arguments that the company couldn't be forced
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  to honor verbal contracts was a key point in this ruling.
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  The judges had contended that the verbal agreement between
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  Shobinger and the former management did not constitute A
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  binding contract, and the lawsuit details that management
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  at Twitter prior to and following Musk's takeover in
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  October 2022, assured employees of receiving 50% of their annual
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  bonuses for 2022 if they remained with the company.
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  Now, these bonuses, typically dispersed in the first quarter
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  of the following year, were reportedly never paid, and X
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  Corpse legal representation had argued that the verbal contract
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  was invalid under Texas law. But the judge's decision firmly
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  established the California law as the governing jurisdiction,
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  regardless of the state law in question.
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  The judge ruled that all of X Corp's arguments for dismissal
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  were unsuccessful. Now, Schulbinger's departure
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  from X Corp in May was attributed to the company's
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  failure to fulfill various promises, including the payment
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  of 2022 bonuses. His lawsuit adds to a series of
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  legal challenges faced by X Corp since Musk's acquisition.
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  Now, the judge's decision to allow the lawsuit to proceed
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  adds another layer of complexity to X Corp's ongoing legal
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  issues. That companies transition from
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  Twitter to X Corp under Musk's ownership has been marked with
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  significant workforce reductions and operational changes, and the
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  acquisition of Twitter by Musk for a staggering $44 billion was
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  a high profile event in the tech sector.
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  Musk's approach to managing the platform, including significant
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  staff layoffs and controversial policy shifts, has drawn
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  attention and criticism. And Musk, known for his
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  leadership roles in companies like Tesla, faced A challenging
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  task in revitalizing Twitter's business model.
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  His strategies have included attempting to attract
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  advertisers back to the platform amidst the backdrop of declining
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  ad revenue and cash flow issues. Now, X Corp's advertising
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  strategy has faced hurdles, as evidenced by a report from Media
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  Matters which claimed the company ads appeared alongside
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  pro Nazi content. The company disputed these
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  findings, alleging a manipulation of the site's
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  algorithm, and Musk's public remarks have also been a source
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  of controversy. His response to company
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  executives like Disney CEO Bob Iger, who withdrew advertising
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  over concerns of anti-Semitism on the platform, was notably
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  blunt and contentious. This lawsuit is a critical
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  challenge for X as it navigates all the corporate promises, the
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  legal obligations and employee regulations.
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  And the outcome of this case could have significant
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  ramifications for X Corp, formerly known as Twitter.
• 5:04
  Hey, thank you so much for listening today.
• 5:06
  I really do appreciate your support.
• 5:08
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• 5:32
  Please take care of yourselves and each other and I'll see you
• 5:34
  tomorrow.