Settlement Talks Started For 2,000 Ex-Twitter Employees in Lawsuits Against X Corp.
Elon Musk’s X Corp. has reportedly agreed to engage in settlement discussions regarding arbitration claims brought by approximately 2,000 former
Nik Richie
Elon Musk’s X Corp. has reportedly agreed to engage in settlement discussions regarding arbitration claims brought by approximately 2,000 former employees who were laid off following Musk’s acquisition of Twitter in October 2022.
According to an attorney, Shannon Liss-Riordan, who is representing the claimants, “After 10 months of pressing them in every direction we have succeeded in getting Twitter to the table.” Liss-Riordan’s memo to clients, as quoted in a Bloomberg article, revealed that Twitter is interested in mediating with the claimants as part of a global effort to resolve all claims that have been filed.
Private negotiations with a mediator are scheduled for December 1 and December 2, according to the memo. A person familiar with the matter, who chose to remain anonymous, confirmed that X Corp. is complying with a court order to mediate the disputes.
In an August 28 court filing, an X Corp. attorney disclosed that “Twitter has received more than 2,200 individual demands for arbitration.” CNBC estimated that the filing fees alone for this volume of cases could reach $3.5 million. X Corp. has been striving to distribute the arbitration costs equally between the parties for arbitrations pending in jurisdictions where fee-sharing is lawful.
The decision to engage in mediation follows an earlier dispute where Twitter allegedly refused to cover arbitration costs despite compelling ex-employees to pursue arbitration instead of lawsuits. Shannon Liss-Riordan has filed multiple class actions on behalf of former Twitter employees, as well as a suit on behalf of vendors claiming that Musk’s company has failed to settle its invoices.
One class action filed in November 2022 alleged that Twitter (now renamed “X”) violated the federal and California Worker Adjustment and Retraining Notification (WARN) Acts, which necessitate a 60-day advance written notice before a mass layoff. The lawsuit sought financial damages, claiming that the laid-off employees were not provided with severance pay or the requisite notice.
In January 2023, a federal judge granted Twitter’s motion to compel arbitration, as the ex-employees had not opted out of the company’s arbitration agreement. While the class action has continued with ex-employees who chose not to opt out, Liss-Riordan initiated numerous arbitrations on behalf of individuals laid off from Twitter.
In July, Liss-Riordan filed a lawsuit alleging that Twitter refused to cover arbitration costs despite having previously insisted that ex-employees arbitrate instead of litigate their claims. Twitter “has refused to engage in arbitration—despite having compelled employees to arbitrate their claims,” the lawsuit asserted.
“Approximately 2,000 of Twitter’s former employees have attempted to pursue arbitration claims against the company, following Twitter’s successfully moving to compel arbitration in several federal class action cases in court against it,” the July lawsuit stated.
X Corp. is facing allegations that include failing to provide promised severance payments to laid-off employees, discriminating against employees based on sex, race, age, and disability, neglecting to fulfill promised bonuses, violating the WARN Act (Family and Medical Leave Act), FMLA, and other violations.
“We are very proud to be representing nearly 2,000 former Twitter employees, in individual arbitrations as well as more than a dozen class action lawsuits in court,” stated Shannon Liss-Riordan. “We are working hard to recover what they are owed.”