Twitter's former chairman sues X over unpaid options
- Reference: 1723469533
- News link: https://www.theregister.co.uk/2024/08/12/twitters_former_chairman_sues_x/
- Source link:
The [1]lawsuit [PDF] was filed in the California Superior Court in San Francisco late last week and concerns $20 million in shares allegedly owed to Twitter's ex- executive chairman, Omid Kordestani.
According to the lawsuit, Kordestani left a highly paid job at [2]Google to join the company - previously known as Twitter - on a significantly reduced salary of $50,000 in his first year, which was less than 0.4 percent of his prior earnings.
[3]
However, or so the suit claims, he was given stock options based on performance and Twitter's future value instead of cold, hard cash. These should have been paid out when Musk acquired the social media platform and fired its board, but they were not, claims the suit.
[4]
[5]
Four other Twitter executives who were jettisoned when Musk took over sued the billionaire [6]earlier this year over $128 million in severance payments and unpaid stock options . At the time, Musk countered that the executives he let go committed gross negligence and wilful misconduct.
Kordestani joined Twitter in 2015 and served as its executive chairman until 2020. In early 2020, as part of an effort to settle an activist action, Twitter tweaked its governance structure, which included retiring the executive chairman role. Kordestani then assumed the role of non-employee director. Twitter granted him additional Restricted Stock Units (RSUs) for his trouble.
[7]
Shortly after, [8]Twitter was acquired for $44 billion , and Musk anointed himself the sole member of the board.
[9]Under-fire Elon Musk urged to get a grip on X and reality – or resign
[10]Twitter tells advertisers to go fsck themselves, now sues them for fscking the fsck off
[11]Elon Musk is suing OpenAI again, claims CEO Sam Altman ‘betrayed’ him
[12]Here we go again. And again. Musk threatens to pull Twitter, SpaceX out of California
According to Kordestani's lawsuit, his stock options – $20.1 million for his vested options, $2.7 million for his performance-based restricted stock units (PSUs), and $246,122.20 for his RSUs – should have been paid out after the deal was closed.
This did not happen.
The lawsuit claims that Musk's social media mouthpiece, X, "now refuses to meet those obligations, adding to a long list of unpaid bills accruing under Mr. Musk's watch."
"X Corp. faces suits and claims from many employees, landlords, and vendors Mr. Musk has failed to pay."
[13]
The Register contacted X to get its take on Kordestani's complaint and received the response, "Busy now, please check back later." ®
Get our [14]Tech Resources
[1] https://regmedia.co.uk/2024/08/12/kordestani_v_x_corp_complaint.pdf
[2] https://www.theregister.com/2014/07/18/google_q2_2014_earnings/
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2ZroxoJlnzNgoOkMSF2rtogAAAAo&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZroxoJlnzNgoOkMSF2rtogAAAAo&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33ZroxoJlnzNgoOkMSF2rtogAAAAo&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[6] https://www.theregister.com/2024/03/05/twitter_management_sue_musk/
[7] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44ZroxoJlnzNgoOkMSF2rtogAAAAo&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[8] https://www.theregister.com/2022/04/25/elon_musk_buys_twitter/
[9] https://www.theregister.com/2024/08/07/elon_musk_chamber_progress/
[10] https://www.theregister.com/2024/08/06/twitter_rumble_wfa_musk/
[11] https://www.theregister.com/2024/08/05/musk_new_lawsuit_openai/
[12] https://www.theregister.com/2024/07/17/musk_california_laws/
[13] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/personaltech&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33ZroxoJlnzNgoOkMSF2rtogAAAAo&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[14] https://whitepapers.theregister.com/
Ah, you got there first...
> Four other Twitter executives .. sued the billionaire earlier this year over $128 million .. Musk countered that the executives he let go committed gross negligence and wilful misconduct.
Heard this at the time, but I was already planning on saying that this shamelessly transparent, self-interested and dishonest attempt to smear those he'll use any sham excuse to avoid paying was straight out of the "Trump playbook".
What a contemptible, deadbeat, bullying prick.
No time limit?
I don't know the law surrounding this but he only realised/felt it appropriate to take this action after 4 years?
Surely a missing $23million would be noticed a bit sooner.
What I'm wondering is, at what point does the responsibility pass to Mr. Kordestani to get his affairs sorted in a timely manner.
Re: No time limit?
I suspect the bit where it has come to filing a case doesn't come out of the blue, but at the end of a series of attempts to be paid and delaying techniques. Most people, when they are owed money, don't go straight to lawyers (not least because that's an expense you won't get back), but first attempt, through reasonable means, to get in contact with the person or entity that owes them money and open a dialogue about getting paid. If nothing else, if you can't show that you've done so, your court case is unlikely to succeed. I'd assume that this process has been undergone in this case, and has been met with avoidance and delaying tactics by Space Karen, as is his modus operandi .
Twitter flatlined for the duration on the Stock Exchange ..
Twitter get delisted on 2013 with a stock price less than 2022 price.
[1]Is Twitter on the Stock Market? Will It Ever Return?
[1] https://tweetdelete.net/resources/is-twitter-on-the-stock-market-will-it-ever-return/
"unpaid stock options"
Hey buddy, Musk already doesn't pay his bills, you really think he cares about your golden parachute ?
The Million Pound Note
It seems like melon husk has eaten the trump playbook - I'm so rich I don't need to pay any bills.
It reminds me of a section of the 1954 film with Gregory Peck, where the mere knowledge he held the million pound note was enough to feed, clothe and get lavish accommodation for himself.