By Enyichukwu Enemanna
A court in the United States has found social media giant Twitter, now branded X, guilty of violating a contract agreement following its failure to pay annual performance bonuses it orally promised its workers.
A former employee, Mark Schobinger had in June filed a breach-of-contract lawsuit against the US-owned company acquired by billionaire, Elon Musk.
The lawsuit said Twitter had promised workers a 2022 performance bonus if they stayed with the company through the final possible payout date. The period covered the first quarter of this year.
The court threw out Twitter’s attempts to have the case dismissed, ruling that Schobinger’s claim of breach of contract under California law was valid.
“Schobinger has plausibly stated a breach of contract claim under California law. He alleges that Twitter orally promised to pay each employee a portion of the bonus contemplated,” a US District Judge Vince Chhabria wrote.
“And by allegedly refusing to pay Schobinger his promised bonus, Twitter violated that contract,” the judge ruled.
Musk is currently facing multiple headwinds, including an EU probe under a law designed to combat disinformation and hate, criticism of the platform’s response to recent rioting in Dublin, and an exodus of top advertisers.
The company is now worth less than half of the $44 billion, an amount Musk paid for the October 2022 acquisition, internal documents reported by tech publication The Verge had indicated.