Elon Musk’s ownership of Twitter, now called X, began with a lawsuit. When Musk tried to break a $44 billion merger agreement, Twitter filed a lawsuit that gave Musk no choice but to complete the deal.
In the year-plus since Musk bought the company, he’s been the defendant and plaintiff in many more lawsuits involving Twitter and X Corp. As 2023 comes to a close, this article rounds up a selection of notable lawsuits involving the Musk-led social network and provides updates on the status of the cases.
Musk sues Twitter law firm
Musk seemingly held a grudge against the law firm that helped Twitter force Musk to complete the merger. In July, X Corp. sued Wachtell, Lipton, Rosen & Katz in an attempt to claw back the $90 million that Twitter paid the firm before Musk completed the acquisition.
Most of that money was paid to Wachtell hours before the merger closed. X’s lawsuit in San Francisco County Superior Court claimed that “Wachtell arranged to effectively line its pockets with funds from the company cash register while the keys were being handed over to the Musk Parties.”
Wachtell sought to move the dispute into arbitration, pointing out that the contract between itself and Twitter contained a binding arbitration clause. In October, the court granted Wachtell’s motion to compel arbitration and stayed the lawsuit pending the outcome.
Unpaid-bill lawsuits
While Twitter paid the Wachtell legal bill before Musk could block the payment, dozens of lawsuits allege that X has refused to pay bills owed to other companies that started providing services to Twitter before the Musk takeover.
The suits were filed by software vendors, landlords, event planning firms, a private jet company, an office renovator, consultants, and other companies. The lawsuits helped some companies obtain payment via settlements, but X has continued to fight many of the allegations. We covered the unpaid-bill lawsuits in-depth in this lengthy article published in September.
Musk sues Media Matters
Musk has repeatedly blamed outside parties for X’s financial problems, which are largely due to advertisers not wanting to be associated with offensive and controversial content that used to be more heavily moderated before Musk slashed the company’s staff.
One of the biggest ad-spending drops came after a November 16 Media Matters report that said corporate ads were placed “next to content that touts Adolf Hitler and his Nazi Party.” Musk’s X Corp responded by suing Media Matters a few days later, claiming the group “manipulated the algorithms governing the user experience on X to bypass safeguards and create images of X’s largest advertisers’ paid posts adjacent to racist, incendiary content.”
The suit was filed in US District Court for the Northern District of Texas. There aren’t any significant updates on the case to report yet.
X Corp. previously filed a similar lawsuit against the nonprofit Center for Countering Digital Hate (CCDH), claiming the group “improperly gain[ed] access” to data, and “cherry-pick[ed] from the hundreds of millions of posts made each day on X” in order to “falsely claim it had statistical support showing the platform is overwhelmed with harmful content.”
The CCDC filed a motion to dismiss X’s lawsuit on November 16, saying that its actions constituted “newsgathering activity in furtherance of the CCDH defendants’ protected speech and reporting.” The motion and case are still pending in US District Court for the Northern District of California.
Musk suit against data scrapers tossed
In July, X Corp. sued unidentified data scrapers in Dallas County District Court, accusing them of “severely tax[ing]” company servers by “flooding Twitter’s sign-up page with automated requests.” The lawsuit was filed days after Twitter imposed rate limits capping the number of tweets users could view each day.
“Several entities tried to scrape every tweet ever made in a short period of time. That is why we had to put rate limits in place,” Musk wrote at the time.
The lawsuit initially listed four John Doe defendants and was amended to raise the number of defendants to 11. This was a tough lawsuit for X to pursue because it didn’t know who the scrapers were and identified them only by their IP addresses.
X issued subpoenas to Amazon Web Services, Akamai, and Google in attempts to gain information on the John Does behind the IP addresses, but the case fizzled out. On October 30, a Dallas County judge dismissed the lawsuit “for want of prosecution” and ordered X to pay the court costs.
Laid-off employees still seeking payment
Employees laid off after the merger have been fighting to receive severance from Musk for the past year. One class-action complaint in November 2022 sought financial damages, alleging that laid-off employees weren’t given severance or the advance notice required by the federal and California Worker Adjustment and Retraining Notification (WARN) Acts.
In January 2023, Twitter won a federal court ruling that forced plaintiffs into arbitration, but Musk’s company then refused to pay its share of the arbitration costs. It wasn’t until September that X Corp. agreed to settlement talks on arbitration claims from about 2,000 ex-employees.
“After 10 months of pressing them in every direction we have succeeded in getting Twitter to the table,” attorney Shannon Liss-Riordan wrote in a memo to clients at the time. “Twitter wants to mediate with us in a global attempt to settle all claims we have filed.”
There hasn’t been any significant movement in negotiations since then, Liss-Riordan told Ars on December 18. “There has not been a resolution. We are moving forward with our dozen lawsuits in court and approximately 2,000 individual arbitrations,” she told us. On December 22, a US District Court judge in the Northern District of California denied Twitter’s motion to dismiss a breach-of-contract claim related to unpaid employee bonuses.
Another class action filed in June alleged that X failed to pay bonuses promised to current and former employees who stayed at the company after Musk’s acquisition. X’s motion to dismiss that case is pending.
In yet another case, former Twitter CEO Parag Agrawal and two other executives fired by Musk sued the firm in April to obtain $1.1 million for legal expenses that X refused to reimburse. In October, Delaware Court of Chancery Judge Kathaleen McCormick ruled that Musk’s firm had to pay the expenses.
Lastly, former Twitter security executive Alan Rosa sued Elon Musk and X Corp. earlier this month, alleging that he was unlawfully fired for objecting to steep budget cuts implemented shortly after Musk bought the social network. Rosa said he tried to resolve his claims through arbitration but finally filed a lawsuit because X “refused to pay its portion of the arbitration fees despite being ordered by JAMS [Judicial Arbitration and Mediation Services] to do so.”
SEC lawsuit forces Musk to testify
Just like Tesla, the social network formerly named Twitter has been caught up in Musk’s long-running battles with the Securities and Exchange Commission. The SEC sued Musk in October, saying he refused to appear for a third round of testimony in an investigation into whether he violated federal securities laws with his 2022 purchases of Twitter stock.
Musk responded in November by asking the court to block the SEC’s subpoena and claimed the agency is “harassing” him. Musk promptly lost his attempt to avoid testifying, as a federal magistrate judge said this month that she would issue an order compelling Musk to testify if the sides don’t agree on logistics for his next deposition.
The investigation focuses partly on how Musk, prior to buying Twitter outright, acquired a 9 percent stake in the company and failed to disclose it within 10 days as required under US law. The SEC said it is also probing Musk’s “2022 statements and SEC filings relating to Twitter” and that it has acquired thousands of documents that it wants to question Musk about.
Music publishers make copyright claims
Music publishers are seeking hundreds of millions of dollars from X for alleged copyright violations. Members of the National Music Publishers’ Association trade group sued in June, saying that Musk’s firm does little to stop copyright infringement and doesn’t pay for music rights like other social media companies do.
The complaint pointed out that Musk called the Digital Millennium Copyright Act a “plague on humanity.” It also said that negotiations for licensing rights with Universal, Sony, and Warner stalled after Musk’s takeover.
“Twitter knows perfectly well that neither it nor users of the Twitter platform have secured licenses for the rampant use of music being made on its platform as complained of herein,” the complaint said.
In an August 2023 motion to dismiss, X said its terms of service forbid copyright infringement and that the plaintiffs “fail to adequately allege direct infringement because the Complaint does not contend that X acted with the requisite ‘volitional’ conduct.” The motion and case are pending in US District Court for the Middle District of Tennessee.
Musk sued for defamation
Musk was sued for defamation in early October by 22-year-old Benjamin Brody, whose lawsuit said Musk amplified false claims from “an anonymous far-right extremist Twitter account” that accused Brody of being involved with a neo-Nazi group.
“In yet another example of Elon Musk’s serial pattern of slander, he falsely told the world that Ben Brody participated in a violent street brawl on behalf of a neo-Nazi extremist group,” the lawsuit said. “Musk also falsely stated that Ben Brody’s alleged participation in the extremist brawl meant the incident was probably a ‘false flag’ operation to deceive the American public.”
Brody’s case against Musk seeks at least $1 million and is pending in the district court of Travis County, Texas. Musk had not filed a response to the allegations as of this writing.