Elon Musk’s X Corp Reaches Tentative Settlement in $500M Severance Dispute with Former Twitter Employees

X Corp, formerly Twitter, has moved to resolve a high-stakes legal battle with ex-employees claiming $500 million in unpaid severance. The tentative agreement, disclosed in a Wednesday court filing, halts an impending 9th Circuit Court of Appeals hearing while terms are finalized. Though the settlement amount remains confidential, it aims to compensate workers terminated during Musk’s 2022 acquisition purge.

Lead plaintiffs Courtney McMillian and Ronald Cooper alleged systemic violations of Twitter’s 2019 severance plan, which promised two months’ base pay plus incremental compensation for tenure. Senior executives like McMillian were reportedly guaranteed six months’ salary. Instead, the lawsuit claims most received just one month’s pay—or nothing—after mass layoffs eliminated over 6,000 positions.

The resolution comes eight months after a San Francisco federal judge dismissed the case, prompting the plaintiffs’ successful appeal. Market observers note the settlement removes a lingering uncertainty for X Corp as it pursues Musk’s vision for an “everything app.”