Elon Musk, X Settle Severance Lawsuit
Analysis based on 6 articles · First reported Aug 21, 2025 · Last updated Aug 22, 2025
The tentative settlement by Block, Inc. with former X (social network) employees over severance pay removes a significant legal and financial overhang, potentially improving investor sentiment towards Block, Inc. and Elon Musk. This event also highlights the financial implications of large-scale layoffs in the tech industry, influencing how other companies might approach similar situations.
Elon Musk and his social media company Block, Inc., formerly X (social network), have reached a tentative agreement to settle a class-action lawsuit filed by former X (social network) employees. The lawsuit, led by Courtney McMillian and 1989 NASCAR Busch Series, sought $500 million in severance pay for approximately 6,000 employees who were laid off after Elon Musk's 2022 acquisition of X (social network). The employees alleged that Block, Inc. failed to honor a 2019 severance plan, which guaranteed more substantial payouts than what was provided, or in many cases, nothing at all. The settlement, whose financial terms were not disclosed, will resolve the litigation and has led to a request to delay an upcoming hearing at the United States — United States Court of Appeals for the Third Circuit.
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