Sanford Heisler Sharp McKnight Continues to Pursue Severance Payment on Behalf of Former Twitter Employees

Sanford Heisler fights to help class members avoid deceptive release agreements pushed on them by Defendants Elon Musk and X

SAN FRANCISCO, Jan. 30, 2026 (GLOBE NEWSWIRE) -- Sanford Heisler Sharp McKnight today filed an amended Complaint against Elon Musk and X Corp, formerly known as Twitter, in U.S. District Court for the District of Northern California.

The amended Complaint is filed on behalf of former Twitter employees who never received the severance benefits they were entitled to after Defendant Musk took over the company and laid off thousands of workers. A newly added plaintiff joins the previously named plaintiffs to demand X Corp. and Musk abide by the terms of the severance plan in place during the October 2022 mass layoffs.

The case is a continuation of the claims in the previously filed case McMillian et al. v. Musk et al. (No. 3:23-cv-03461-TLT), which was dismissed after the individual Named Plaintiffs declined to pursue claims under ERISA. The amended Complaint continues to allege that Twitter’s severance plan was a “welfare benefit plan,” bringing the plan under the purview of the federal Employee Retirement Income Security Act, or ERISA. ERISA is a broad federal statute with significant protections for employee benefits, including requiring that an employer administering a benefit plan must act in the best interest of plan participants and must provide them with complete and accurate information about their benefits.

After Defendant Musk’s takeover in 2022, he posted on his personal X account that the company’s terminated employees were receiving “50% more [severance] than legally required.” However, the amended Complaint alleges that Defendants Musk and X violated ERISA by, among other things, offering significantly less severance than they owed to the terminated employees under the Twitter Severance Plan. The amended Complaint further alleges that these violations invalidated any ERISA releases signed by potential class members. A recent Ninth Circuit decision, Schuman v. Microchip, ruling that ERISA releases are subject to heightened scrutiny bolsters this position.

“Twitter and Musk promised employees that their severance benefits would remain the same through the acquisition, then suddenly offered them a fraction of what they were owed and told them it was more than they deserved,” said Kate Mueting, Partner at Sanford Heisler Sharp McKnight and counsel for Plaintiffs. “ERISA does not allow this kind of behavior. It provides a pathway for people like our clients to seek justice and hold companies accountable.”

“We remain absolutely committed to representing people who were terminated and given far less severance than they were owed by these Defendants,” said Sanford Heisler Sharp McKnight Co-Vice Chairman Charles Field. “It doesn’t matter how rich or powerful you are, the law still applies to you.”

The case is Ye et al. v. Musk et al., No. 3:25-cv-09501-PHK, in the federal District Court for the Northern District of California. The Plaintiffs are represented in the matter by Sanford Heisler Sharp McKnight Partner Kate Mueting (D.C. Office), Co-Vice Chairman Charles Field (San Diego Office), Of Counsel Kristi Stahnke McGregor (Nashville Office), Associate Susannah Cohen (N.Y. Office), Associate Shannon Henris (D.C. Office), and Of Counsel Dacey Romberg (Nashville Office).

About Sanford Heisler Sharp McKnight, LLP

Sanford Heisler Sharp McKnight, LLP is a national public interest class-action litigation law firm with offices in New York, Washington, D.C., San Francisco, Palo Alto, San Diego, and Nashville. Sanford Heisler Sharp McKnight focuses on employment discrimination, Title IX, wage and hour, whistleblower, criminal/sexual violence, and financial services matters. The firm has recovered over $1 billion for its clients through many verdicts and settlements. The National Law Journal recognized Sanford Heisler Sharp McKnight as 2021 Employment Rights Firm of the Year, 2021 Human Rights Firm of the Year, and 2022 Civil Rights Firm of the Year.

For the latest news about Sanford Heisler Sharp McKnight, visit the firm’s newsroom or follow the firm on Facebook, LinkedIn, or Twitter. 

If you have potential legal claims and are seeking counsel, please call 619-577-4253 or email david.sanford@sanfordheisler.com. Attorneys at Sanford Heisler Sharp McKnight would like to have the opportunity to help you.

If you have experienced employment discrimination or unlawful termination and are seeking counsel, please call 202-499-5206 or email kmueting@sanfordheisler.com. Attorneys at Sanford Heisler Sharp McKnight would like to have the opportunity to help you.

For more information, contact Jamie Moss, newsPRos, at 201-788-0142 or Jamie@newspros.com.

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