Federal Judge intervenes as Twitter fails to pay millions in bonuses

A federal judge ruled that X/Twitter violated contracts by failing to pay millions of dollars in bonuses that the social media company had promised its employees, reported by Reuters. Mark Schobinger, Twitter’s senior director of compensation, sued X/Twitter after leaving Elon Musk’s company in May, claiming breach of contract. The company promised employees 50% of their 2022 target bonuses, but never made those payments. US District Judge Vince Chhabria denied Twitter’s motion to dismiss the case, ruling that Schobinger plausibly stated a breach of contract claim under California law and he was covered by a bonus plan. The judge wrote that by allegedly refusing to pay Schobinger his promised bonus, Twitter violated the contract. X/Twitter argued that the company made only an oral promise that was not a contract and that Texas law should govern the case.

Meanwhile, Meta, the parent company of Facebook and Instagram, was fined in Italy for breaches of a ban on the advertising of gambling. The company was fined €5.85 million ($6.45 million) in connection with profiles and accounts on Facebook and Instagram, as well as sponsored content that promoted either betting or games with cash prizes, communications watchdog AGCOM said in a statement on Friday. Similar fines were set aside for YouTube and Twitch recently.

This ruling will serve as a reminder to companies to uphold their promises to employees, and the fines imposed on Meta highlight the importance of abiding by advertising regulations in various countries. Both cases provide insight into the legal challenges that big tech companies face, as they navigate the complexities of employment contracts and advertising laws.