Twitter, a well-known social media platform, is currently the subject of a new scandal when Joele Frank, a former PR agency, filed a lawsuit against the business for more than $800,000 in allegedly unpaid invoices.
The former PR agency for Twitter filed the complaint on Friday, alleging that since Elon Musk bought the business in October of last year, the company has neglected to pay its debts.
Only three weeks after Musk took control, the PR agency and Twitter broke up their relationship on November 16, according to Reuters, but the firm asserts that Twitter still owes a total of $830,498 over six outstanding bills.
The PR company said that the social media behemoth had ceased responding to its payment requests in favour of delivering automated promises that it would « get started processing it right away. »
Twitter has been accused of not paying for services before. Ten or more suppliers have sued Twitter since Musk became the company’s new CEO, alleging unpaid invoices for their services.
Additional lawsuits against Twitter
In addition to the Joele Frank action, Twitter is being sued by three former employees, including former CEO Parag Agrawal, who claim the firm failed to honour its promise to pay them more than $1 million in legal expenses.
According to Bloomberg, Twitter also owes more than $10 million to a number of smaller businesses, including public relations agencies and suppliers of branded items. These smaller vendors have claimed that the accounts payable team at Twitter no longer personally responds to them and that they now only get automated answers.
Along with PR agencies and former executives, several businesses and landlords have also launched their own lawsuits alleging that Twitter owes them money.
For unpaid rent at the business’s London headquarters, the United Kingdom’s Crown Estate sued Twitter in January. Similar to this, Twitter’s San Francisco headquarters’ landlord has filed a lawsuit over allegedly unpaid rent payments.
Elon Musk’s Viewpoint and Twitter’s Reaction
Twitter, also known as X Corp, answered to the PR firm’s complaint without making a substantive remark and instead used the feces emoji. Elon Musk’s legal counsel has not yet responded to the query in a timely manner.
Despite a fall in advertising income, Musk, the CEO of Tesla and second-richest person in the world, has stated his optimism that Twitter might generate positive cash flow as early as this quarter. He calculates that since he bought Twitter, its value has decreased by more than 50%.
The case is now being tried at the New York County Division of the New York State Supreme Court and is titled JF Associates LLC v. X Corp. It adds a new chapter to the never-ending story of Twitter’s financial issues and casts doubt on the firm’s future capacity to handle its debts and commitments.
As Twitter and Elon Musk work to address the outstanding debts and contractual duties, the results of these legal procedures will decide the financial consequences.
