X, formerly known as Twitter owner Elon Musk, has won the $500 million severance lawsuit filed by the former employees.
According to Reuters, former X employees filed a lawsuit against the billionaire over firing thousands of employees after taking over the social media site in October 2022.
Former employees alleged that the SpaceX owner owed at least $500 million in severance pay to about 6,000 laid-off employees as per the federal Employee Retirement Income Security Act (ERISA).
However, US District Judge Trina Thompson ruled on Tuesday, July 9, in San Francisco that the lawsuit filed by the employees did not cover ERISA as the company informed employees that those who were let go would only get cash payouts.
She wrote in the verdict, “There were only cash payments promised.”
The judge said that there was no ‘ongoing administrative scheme’ under which the company reviewed claims on a case-by-case basis or offered benefits such as continued health insurance and outplacement services.
Thompson also suggested the petitioner amend their complaint, but only for claims not under ERISA.
