US Court Rules Twitter in Breach of Contract for Non-Payment of Bonuses

Now rebranded as X, Twitter faces a breach-of-contract lawsuit initiated by former employee Mark Schobinger. The company failed to fulfil its commitment to provide annual performance bonuses to employees who stayed through the specified payout date in the first quarter of this year.

The court dismissed Twitter’s attempt to dismiss the case, affirming the validity of Schobinger’s breach-of-contract claim under California law.

US District Judge Vince Chhabria stated, “Schobinger has plausibly stated a breach of contract claim under California law, alleging that Twitter orally committed to paying employees a portion of the envisaged bonus. By reportedly reneging on Schobinger’s promised bonus, Twitter violated the contract.”

Although Twitter, now owned by Elon Musk, retains the option to appeal, it faces numerous challenges, including an EU probe on disinformation and hate, criticism of its response to recent unrest in Dublin, and a departure of prominent advertisers. Internal documents suggest a significant drop in the company’s value, falling below half of the $44 billion Musk paid for it in October 2022.

In summary, Twitter’s failure to honour promised bonuses has resulted in an upheld breach-of-contract lawsuit by the US federal court. The company’s legal troubles, alongside other issues, have contributed to a decline in value and the departure of major advertisers.

Dan Olczak

"Editor with expertise in politics and crime, also known for travel blogging."

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