Twitter’s former chief executive Parag Agrawal and two other former executives have sued the company over more than $1 million (£800,000) in legal bills they say should have been reimbursed.
The expenses relate to the executives’ official positions, including investigations by the US Department of Justice and the Securities and Exchange Commission, they said in the action filed in Delaware Chancery Court.
Agrawal, along with former general counsel Vijaya Gadde and former chief financial officer Ned Segal, were terminated by Elon Musk when he took over Twitter last October in a $44bn deal.
The three claim Twitter has “refused to acknowledge its obligations and to remit payment of any invoices” after they personally incurred “significant expenses” responding to lawsuits and investigations.
“This action seeks an expedited ruling requiring Defendant to comply with its obligations to advance legal fees and expenses relating to ongoing litigation and investigations,” the lawsuit says.
Twitter “breached the agreements [with employees] and contravened the bylaws” by not reimbursing the former executives.
It is unclear what the regulatory investigations relate to and whether they are ongoing.
The SEC has investigated whether Musk breached securities regulations by failng to make timely disclosures when he initially purchased a 9.2 percent stake in Twitter.
Musk has instituted aggressive cost-cutting at Twitter since taking over, in the face of $1.5bn of annual interest payments on the $13bn of debt he used to fund the acquisition and declining ad revenues.
That has included stopping payments to vendors, landlords and business partners, leading to multiple lawsuits including one over unpaid rent on the firm’s San Francisco headquarters.
At the time that the executives were fired last October the three were reportedly due tens of millions of dollars in severance pay and unvested stock awards – nearly $60m in Agrawal’s case alone.
But Musk reportedly fired them “for cause” in an effort to avoid making those payments.
At the time The New York Times cited unnamed sources as saying the executives were considering whether to challenge their dismissals in court.
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