Elon Musk’s X Corp has filed a lawsuit against law firm Wachtell, Lipton, Rosen & Katz, aiming to reclaim a substantial portion of the $90 million fee they were paid for their role in preventing Musk from abandoning his $44 billion acquisition of Twitter.
Elon Musk’s X Corp, which holds ownership of Twitter, has initiated legal proceedings against the renowned law firm Wachtell, Lipton, Rosen & Katz. The objective of the lawsuit is to retrieve a substantial portion of the $90 million fee that the law firm was paid for effectively stopping Musk from backing out of his $44 billion acquisition of Twitter.
The filing of the complaint took place on Wednesday at the California Superior Court situated in San Francisco.
Musk has leveled accusations against Wachtell, alleging that the firm capitalized on the situation by accepting sizable “success” fees from Twitter executives who were leaving, shortly before the completion of the buyout on October 27, 2022. It is claimed that these executives expressed gratitude as they believed it would force Musk to proceed with the acquisition.
Even though Wachtell invoiced less than a third of the $90 million fee for their involvement in the Delaware lawsuit spanning a few months, Elon Musk, the richest person in the world who oversees Tesla Inc and SpaceX, considered the payment to be “unconscionable.”
According to the complaint, Wachtell allegedly orchestrated a scheme to enrich themselves using funds from the company’s coffers precisely at the moment when control was being transferred to Musk.
Musk aims to recoup the “excessive” fees levied by Wachtell, as per an agreement executed on the same day the buyout was finalized. This agreement involved a partner from Wachtell and Twitter’s chief legal officer, Vijaya Gadde.
The complaint additionally incorporates a statement from former Twitter director Martha Lane Fox, who, upon learning about the lawyers’ payment amount, sent an email to the company’s general counsel, Sean Edgett, expressing her astonishment with the words, “O My Freaking God.”
At present, Wachtell has not responded to the requests for comment. It is important to mention that Vijaya Gadde, Martha Lane Fox, and Sean Edgett are not directly implicated in the lawsuit.
