In a decisive move that closes a contentious chapter of the Twitter acquisition saga, Elon Musk’s X Corp. has officially dropped its lawsuit against the elite law firm Wachtell, Lipton, Rosen & Katz. The legal dispute, which centered on a staggering $90 million “success fee” paid to the firm, was dismissed with prejudice on Wednesday, meaning the social media giant cannot revive the claim in the future.
The conflict stems from the chaotic period leading up to Musk’s 2022 takeover of the platform formerly known as Twitter. Wachtell was instrumental in forcing the billionaire to honor his initial agreement to purchase the company for $44 billion, a deal Musk had famously attempted to exit. Following the successful closure of the acquisition, the law firm received a substantial payout for its services—a fee Musk later characterized as an “improper bonus” authorized by departing Twitter executives who he claimed were “running up the tab.”
However, the legal challenge has now dissolved without a courtroom showdown. In a filing submitted to a California state court, X Corp. moved to dismiss the case entirely. While the filing itself did not elaborate on the specific reasoning behind the sudden reversal, the outcome appears to be a clean win for the legal firm.
No Settlement Reached
Crucially, the dismissal does not appear to be the result of a financial compromise. A spokesperson for Wachtell issued a statement confirming the firm’s satisfaction with the result, emphasizing that “there was no settlement.” This suggests that X Corp. walked away from the litigation without recovering any portion of the disputed funds.
Prior to this dismissal, a judge had ruled that the matter should proceed to private arbitration, moving the battle out of the public eye. The two parties were scheduled to update the court on the status of those proceedings in early December. Wachtell had steadfastly denied any wrongdoing throughout the process, arguing that the fees were fully approved by Twitter’s former board and were justified given the firm’s role in securing billions in value for shareholders by ensuring the merger closed.
With this legal hurdle cleared, Musk’s X Corp. continues its broader restructuring efforts, leaving behind one of the last lingering disputes from the acquisition era.
