July 10 (Reuters) - Elon Musk won dismissal of a lawsuit
claiming he refused to pay at least $500 million of severance to
thousands of Twitter employees he fired in mass layoffs after
buying the social media company now known as X.
U.S. District Judge Trina Thompson in San Francisco ruled on
Tuesday that the federal Employee Retirement Income Security Act
governing benefit plans did not cover the former employees'
claims, and therefore she lacked jurisdiction.
Lawyers for the plaintiffs did not immediately respond to
requests for comment on Wednesday. Musk's lawyers did not
immediately respond to similar requests.
The case is one of many accusing Musk of reneging on
promises to former Twitter employees, including former Chief
Executive Parag Agrawal, and vendors after buying the company
for $44 billion in October 2022.
Musk also runs the electric car company Tesla, and
is the world's richest person, according to Forbes magazine.
According to the complaint, Twitter's 2019 severance plan
called for employees who stayed on after the buyout to receive
two or six months of pay, plus one week of pay for each year of
employment, if they were laid off.
The plaintiffs Courtney McMillian, who oversaw Twitter's
compensation and benefits, and Ronald Cooper, an operations
manager, said Twitter instead offered fired employees just one
month of pay as severance, with no benefits.
Thompson said ERISA didn't apply to Twitter's post-buyout
plan because there was no "ongoing administrative scheme" where
the company reviewed claims case-by-case, or offered benefits
such as continued health insurance and out placement services.
"There were only cash payments promised," she wrote.
The judge said the plaintiffs can try amending their
complaint, but only for claims not governed by ERISA.
The case is McMillian et al v. Musk et al, U.S. District
Court, Northern District of California, No. 23-03461.