Elon Musk’s company X Corp, formerly known as Twitter, has reached a tentative agreement to settle a lawsuit with former employees who say they are owed $500 million in severance. According to a court filing on Wednesday, both sides asked a U.S. appeals court to delay an upcoming hearing so they can finalize the agreement. While the exact amount of the settlement hasn’t been disclosed, it’s expected to end the legal dispute and provide payment to those employees who were laid off after Musk’s 2022 acquisition of Twitter.
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The lawsuit was originally filed by Courtney McMillian, who led Twitter’s employee benefits program, and Ronald Cooper, a former operations manager. They claimed that under Twitter’s 2019 severance plan, most employees were promised two months of base pay plus one week for each full year worked. Senior staff like McMillian were supposed to receive six months of base pay. However, the lawsuit says Twitter only gave some workers one month of severance, if anything, after laying off over 6,000 people to cut costs.
Although a federal judge in San Francisco dismissed the case in July 2024, the plaintiffs appealed to the 9th Circuit Court of Appeals, which was set to hear the case on September 17. If the deal is finalized, that hearing will likely be canceled. Even so, other lawsuits related to Musk’s mass layoffs are still ongoing in California and Delaware. So far, neither Musk’s legal team nor the attorneys for the former employees have commented on the tentative agreement.
What Is the Prediction for Tesla Stock?
When it comes to Elon Musk’s companies, most of them are privately held. However, retail investors can invest in his most popular company, Tesla (TSLA). Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 14 Buys, 15 Holds, and eight Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $307.23 per share implies 4.1% downside risk.
