In a legal twist, a federal judge just gave the green light for a lawsuit against X, the rebranded Twitter, over allegations of breaking promises on staff bonuses. X’s attempt to shut down the case got rejected, keeping it alive. The controversy stems from X’s failure to hand out yearly bonuses post its acquisition by Elon Musk in October 2022, despite execs swearing up and down, both before and after the deal, that the bonuses were coming.
Mark Schobinger, an ex-senior director of compensation at X who left in May, filed the lawsuit in June 2023, aiming for class action status for all the current and past X employees left empty-handed on their 2022 bonuses. Judge Vince Chhabria said the case holds water, stating that Twitter’s promise to pay a bonus turns into a legit contract under California law.
X, which isn’t big on public relations lately, didn’t bother responding to CNN’s request for a word. In their bid to dismiss the case, they argued that a verbal promise shouldn’t be legally binding and suggested the whole matter should go down in Texas. The judge, however, laid down the law, insisting that when it comes to contract stuff, California rules apply.
The lawsuit spills the beans on employees freaking out about their pay and bonuses after Musk spilled the beans about acquiring the company. Despite higher-ups saying bonuses were a done deal, X apparently dropped the ball on the promised 2022 bonuses. This allegedly led to Schobinger waving goodbye in May, thanks to Twitter not holding up its end of the bargain, as the lawsuit puts it. It’s a peek behind the curtain at the messy fallout when promises don’t translate to action in the business world.
