Elon Musk’s company, X Corp, formerly known as Twitter, has reached a tentative settlement in a $500 million lawsuit filed by former employees over unpaid severance. The case was brought by ex-Twitter staff members Courtney McMillan and Ronald Cooper, who claimed the company failed to honor severance commitments following Musk’s 2022 acquisition and subsequent layoffs.
The settlement was revealed in a court filing on August 20, 2025, which also requested a delay of the hearing originally scheduled for September 17 so that both parties could finalize the agreement. The San Francisco federal appeals court approved the request, giving additional time for the settlement process. Financial terms of the agreement have not been disclosed, but it is expected to provide compensation to the affected employees.
This settlement follows earlier legal developments, including a July 2024 federal ruling dismissing a similar lawsuit under the federal Employee Retirement Income Security Act (ERISA). Plaintiffs were allowed to amend their complaint to pursue claims outside ERISA. Meanwhile, other legal actions regarding severance and layoffs are still ongoing, including a separate $128 million lawsuit filed by former CEO Parag Agrawal and other executives.
