Three former executives of Twitter, Parag Agrawal, Ned Segal, and Vijaya Gadde, are suing the company for over $1 million in unpaid legal bills.
The trio incurred the expenses for personal legal bills linked to government investigations, including inquiries by the Securities and Exchange Commission (SEC), Department of Justice, and shareholder lawsuits.
The executives were fired by Elon Musk on his first day in charge after he bought Twitter for $44 billion in October.
According to the lawsuit filed in Delaware Chancery Court on April 10, the justice department contacted counsel for Agrawal and Segal in 2022 concerning investigations related to the company, but the nature of the probe and whether it is still active is unknown.
Additionally, the pair also incurred legal expenses while responding to inquiries by the SEC in 2022, as the SEC investigated whether Musk breached securities regulations by failing to make timely disclosures when he bought a 9.2% stake in Twitter in early 2022.
The lawsuit claimed that the former executives’ legal fees were Twitter’s responsibility, as the social media giant’s bylaws and contracts with former executives require it to pay their legal fees in matters related to the company.
However, Twitter has refused to acknowledge its obligations and pay the invoices. The former executives notified Twitter of their expenses more than two months ago but are yet to be reimbursed.
Musk has cut costs related to Twitter aggressively since he took over and fired over 75% of its 7,500 employees. The terminated executives were voided of their large severance payouts, amounting to almost $60 million for Agrawal, after Musk fired them “for cause” last year.
Aaron Zamost, a spokesman for Segal and Gadde, criticized Twitter for failing to honour its contractual obligations to pay its bills.
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