Here Are All The Big Legal Hurdles Twitter’s Faced Since Elon Musk’s Takeover

Topline

Twitter has experienced major turmoil following its $44 billion sale to Tesla and SpaceX CEO Elon Musk last October, including layoffs, policy changes and perhaps most notably, legal disputes that have potentially left it on the hook for hundreds of millions of dollars.

Twitter has been subject to multiple instances of litigation since last October. Muhammed Selim … [+] Korkutata / Anadolu Agency

Anadolu Agency

Key Facts

A former employee of Twitter, which has laid off more than 5,000 staffers since Musk took over, accused the company of failing to pay at least $500 million in severance pay to former employees in a proposed class action lawsuit filed Wednesday.

In June, a large group of music publishers sought up to $250 million in damages through a lawsuit alleging the platform engaged in mass copyright infringement by letting users post audio and audio-visual clips with copyrighted music.

Twitter parent company, X Corp, sued the law firm Wachtell, Lipton, Rosen & Katz—hired by the platform’s former management—earlier this month for a $90 million payment that Twitter argued should be paid back, according to a filing.

A December lawsuit from a private jet company alleged Twitter refused to pay $197,725 for a flight that transported the company’s former chief marketing officer Leslie Berland—a claim attorneys for Twitter countered, asserting the executive was overcharged for the round trip used to meet with Musk when he was settling into the company.

A proposed class action lawsuit filed in early July also accused Twitter of refusing to process at least 891 arbitration cases filed by former staffers.

Unpaid office fees have also reportedly become a problem for Twitter, which was sued by an Australian infrastructure company last week, which accused it of failing to pay more than $600,000 in infrastructure work bills for offices in multiple countries—the sixth office-related lawsuit Twitter has faced since Musk’s takeover.

Following the launch of Meta’s rival app, Threads, Twitter threatened to sue Meta over the “copycat” app, claiming it misused Twitter’s “trade secrets and other intellectual property” and poached former Twitter staffers to do so.

Big Number

$15 billion. That’s how much Fidelity valued Twitter at in May—a third of the money forked over by Musk for his purchase of the platform last year.

Tangent

Twitter’s legal disputes have been one of several obstacles the platform has faced since it Musk bought it. The platform has also dealt with a swath of its largest advertisers leaving it early in the year. Twitter’s U.S. advertising revenue in April was $88 million, down 59% from the same month last year—a stat that surfaced a few months after Musk claimed the site was “breaking even.” Twitter has also endured a series of outages and glitches that have temporarily left users without the ability to post tweets, load images and share external links. In the midst of its troubles, Meta’s rival app, Threads, launched July 5. Instagram lead Adam Mosseri said in an interview with the Verge that Twitter’s “volatility” and “unpredictability” under Musk is what created an opening for Meta to compete with Twitter through the launch of Threads.

Key Background

Musk’s ownership of Twitter is just one source of legal troubles for the billionaire. His companies Tesla and SpaceX have been subject to a revolving door of lawsuits that have ended in mixed results. Last year, Tesla was sued over allegations it failed to respond to harassment and discrimination complaints. The complaint was filed not long after California’s Department of Fair Employment and Housing filed suit against Tesla, accusing it of discriminating against Black workers. A former Tesla factory worker received a $3 million payout in April following a lengthy suit that alleged the company had a racist work environment. Musk, Tesla and SpaceX were also sued for $258 billion for an alleged dogecoin “Pyramid Scheme” last year. Musk asked a federal judge to throw out the case in April, with attorneys saying the “court should put a stop to plaintiffs’ fantasy and dismiss the complaint.” Musk scored a legal victory in February, though, when a jury found him not liable of defrauding Tesla investors through a series of tweets that suggested he was taking the company private.

Forbes Valuation

We estimate Musk is the richest person in the world, with a net worth of $245.6 billion.