Ex-Twitter executives sue over $1M+ in unpaid legal expenses
- Reference: 1681236194
- News link: https://www.theregister.co.uk/2023/04/11/former_execs_sue_twitter/
- Source link:
Agrawal, along with former CFO Ned Segal and head of legal and policy Vijaya Gadde, claim in [1]the complaint [PDF], filed in the Delaware Chancery Court and shared by the New York Times, that they've racked up the collective seven-digit figure since last year defending themselves and Twitter against four separate cases and government investigations.
Per their claims, the trio's indemnification agreements and Twitter's own corporate bylaws require full reimbursement of legal expenses related to their time at Twitter, both during and after their employment ends.
[2]
According to their lawyers, Twitter hasn't bothered to do anything but acknowledge receipt of the requests, and that only came after three certified letters sent to the company between January and March.
[3]
[4]
"Over two months after plaintiffs initial demand, outside counsel for [Twitter] responded it was in receipt of Plaintiffs various correspondence," the compliant read, adding that Twitter's "counsel did not acknowledge its obligation to advance plaintiffs expenses."
The trio included attachments and excerpts from the indemnification agreements and bylaws in the lawsuit to support their claims. In one excerpt from Twitter's bylaws, the complaint states the company's own rules say that Twitter shall indemnify "any person who was or is a party … to any threatened, pending or completed action, suit or proceeding … by reason of the fact that such person is or was a director or officer of the corporation."
[5]
The bylaws say that expenses including attorney fees, judgments, fines or amounts paid in settlement are all covered. The execs say the indemnification agreements they signed include similar language, along with the addition that Twitter has 30 days from receipt of claims to advance such expense reimbursements.
[6]Twitter users complain 'private' Circle posts aren't
[7]Welcome to open source, Elon. Your Twitter code just got a CVE for shadow ban bug
[8]Twitter scores legal hat trick with three cases filed against it in one day
[9]Twitter blocks Pakistan government account, boosts state-run media from Russia and China
The indemnification agreements further state that if Twitter fails to follow through on its obligation to repay indemnified execs, said execs have the right to take the issue to court in the State of Delaware, as is now the case. If the trio manages to prove their case, Twitter will also be on the hook for legal expenses incurred during the lawsuit.
Twitter didn't respond to requests for comment on the suit with anything meaningful or constructive. (Yep, the poop emoji again.)
Owner Elon Musk has made profitability one of his [10]core missions since taking over the company last October after buying it for $44 billion, though recent reports suggest the man himself believes it's [11]worth less than half that amount.
Twitter is also facing a growing tide of lawsuits, including [12]at least nine cases for unpaid bills like [13]rent at the company's San Francisco headquarters and other locations.
[14]
Along with lawsuits alleging it hasn't been following through on financial obligations, Twitter has been facing technical scrutiny as well. A January lawsuit claims the company failed to protect user privacy when an API issue exposed the data of some [15]200 million Twitteratti , while EU and US regulators have both expressed [16]concerns that staff cuts mean the platform won't be able to properly moderate its content. German authorities have also threatened Twitter with a fine that could go as high as €50 million ($54.7 million, £43.8 million) for [17]violating hate speech laws .
Musk said in early February that, despite his claims that Twitter was losing millions of dollars a day, the company was [18]getting close to breaking even. That claim is looking continually more difficult to justify given the growing number of legal actions the company is facing. ®
Get our [19]Tech Resources
[1] https://int.nyt.com/data/documenttools/twitter-exec-lawsuit-complaint/ea00852cc074cd27/full.pdf
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZDXYhUgr2Q3p6INlN09k1gAAAEA&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
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[6] https://www.theregister.com/2023/04/10/twitter_circle_posts/
[7] https://www.theregister.com/2023/04/07/twitter_code_cve_substack/
[8] https://www.theregister.com/2023/04/05/more_twitter_lawsuits/
[9] https://www.theregister.com/2023/04/04/twitter_bans_pakistan_boosts_china/
[10] https://www.theregister.com/2022/11/28/musk_twitter_slides/
[11] https://www.theguardian.com/technology/2023/mar/26/elon-musk-twitter-value-leaked-memo-less-than-half-paid
[12] https://www.cbsnews.com/news/twitter-lawsuits-elon-musk-landlords-vendors-unpaid-bills/
[13] https://www.theregister.com/2023/01/31/twitter_market_square_lawsuit/
[14] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offbeat/legal&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33ZDXYhUgr2Q3p6INlN09k1gAAAEA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[15] https://www.theregister.com/2023/01/19/twitter_sued_data/
[16] https://www.theregister.com/2023/03/08/eu_us_regulators_concerned_twitter/
[17] https://www.theregister.com/2023/04/05/more_twitter_lawsuits/
[18] https://www.cnbc.com/2023/02/05/elon-musk-says-twitter-trending-to-breakeven-after-near-bankruptcy.html
[19] https://whitepapers.theregister.com/
Good luck ever seeing that money
Musk will hold out paying it until they sue, then delay things in court as long as possible until they decide it isn't worth fighting anymore. i.e. the Trump playbook.
Have an upvote
for "The Trump Playbook"
It is long past time that the defendants have to put into escrow the sum they are being sued for BEFORE the trial begins. It should be done by court order. Failure to do so sends the CEO to jail for contempt and the case is awarded to the plaintiffs by summary judgement.
But... the US legal system is an utter mess and wide open to abuse as demonstrated by Trump, Musk and especially Alex Jones.
Re: Have an upvote
So anyone can sue you for $10m and you have to get that money together and put it in escrow?
Have I understood you correctly?
Re: Have an upvote
UK civil law allows defendants to ask the court to ensure the plaintiff will have the ability to pay costs to prevent defendants being harmed by malicious and vexatious claims.
But making the defendant ante-up is ridiculous, though I recall the judge in a case I was involved in, where a plaintiff tried that play, used more formal language, like "contrary to any concept of a fair judicial process" or something like that.
Courts decide if any redress is due; it is up to the plaintiff to deal with securing redress and costs if they win.
Someone should create a Twitter lawsuit directory
Twitter must now have over a hundred legal cases against it, and probably many dozens more before year end.
Unfair dismissals, violating labour laws, unpaid bills, breaking laws on privacy and hate speech etc. etc. [1]in many dozens of jurisdictions all across the world , from Germany to Delaware, from Ireland to India. I think we need a searchable database.
[Start date, end date, jurisdiction, court, case name, case number/docket number, counter party, suit type, suit status, news articles relating to the case, legal analysis relating to the case] did I forget any fields?
[1] https://slate.com/technology/2023/04/twitter-inc-x-corp-elon-musk-x-nevada.html
NOW I Understand the Advantage of the Cloud!
If these guys get a judgement against Twitter, and Twitter defaults on it, the plaintiffs can't send a team to Twitter HQ to confiscate some servers to re-sell to pay for the judgement, because there aren't any on-prem servers! (It'll take a lot of office desks and desktop PCs resold as used to bring in seven figures ...)