Musk’s company, X Corp, which owns Twitter, wants to recover a large part of the $90 million fee that Wachtell received for helping defeat Musk’s attempt to back out of buying Twitter for $44 billion.
In Short
- Elon Musk is taking legal action against a law firm called Wachtell, Lipton, Rosen & Katz.
- Musk believes that Wachtell took advantage of the situation by accepting huge fees from departing Twitter executives.
- Musk thinks the $90 million payment is too high considering Wachtell did much less work for its smaller fee.
Elon Musk, the CEO of Twitter, is taking legal action against a law firm called Wachtell, Lipton, Rosen & Katz. Musk’s company, X Corp, which owns Twitter, wants to recover a large part of the $90 million fee that Wachtell received for helping defeat Musk’s attempt to back out of buying Twitter for $44 billion.
Musk believes that Wachtell took advantage of the situation by accepting huge fees from departing Twitter executives who were happy that Musk would be forced to complete the purchase. Musk thinks the $90 million payment is too high considering Wachtell did much less work for its smaller fee in the Delaware lawsuit.
“Wachtell arranged to effectively line its pockets with funds from the company cash register while the keys were being handed over” to Musk, the complaint said.
Musk wants to get back the excessive fees that Wachtell charged. He claims that one of Wachtell’s partners and Twitter’s chief legal officer, Vijaya Gadde, signed an agreement on the day the purchase closed, allowing the extra fees to be charged.
The lawsuit also mentions Martha Lane Fox, a former Twitter director, who was shocked when she found out how much the lawyers would be paid. She sent an email to Twitter’s general counsel expressing her surprise.
Wachtell is yet to respond to requests for comment. The report further reveals that Gadde, Fox, and the general counsel are not part of the lawsuit.
Since Musk took over Twitter, the company has been involved in several legal disputes. Landlords, vendors, and consultants have sued Musk for not paying them. Twitter has also threatened to sue Meta Platforms, owned by Mark Zuckerberg, over their new Threads app.
Wachtell has dealt with lawsuits from billionaires before. They had a long legal battle with Carl Icahn over his takeover of CVR Energy in 2012. Icahn later sued Wachtell for malpractice, but the judge dismissed the case.
“The lawsuit between X Corp and Wachtell is being heard in the California Superior Court in San Francisco, with case number CGC-23-607461,” Reuters said. The story was reported by Jonathan Stempel in New York, edited by Marguerita Choy.
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Source: India Today
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