Elon Musk attends The 2022 Met Gala Celebrating “In America: An Anthology of Fashion” at The Metropolitan Museum of Art on May 02, 2022 in New York City.
Dimitrios Kambouris | Getty Images
Elon Musk’s Twitter was sued again in California this week for alleged failure to pay a vendor.
The latest complaint comes from a tech startup called Writer, Inc., and it’s at least the sixth company to sue Twitter in the United States over breach of contract and non-payment since Musk took over about 4 months ago.
The Tesla and SpaceX CEO led a $44 billion buyout of Twitter, which closed around October 27, 2022. He sold billions of dollars worth of his Tesla shares and took on some $13 billion in debt at Twitter as he became the sole director, new owner and CEO there.
Since then, Musk’s social media venture has been sued for non-payment by Writer and at least five others:
Its landlord in San Francisco, Columbia REIT
A private jet transportation service provider, Private Jet Services Group
An events-planning and production company, Blueprint Studios Trends
An M&A consulting firm, Innisfree M&A
And Analysis Group, a company that provided litigation related consulting services to Twitter and its counsel before Musk bought the company.
A legal and public records database, PlainSite, is tracking these lawsuits as they arise.
Twitter’s alleged non-payment of rent to Columbia REIT, has led to the real estate company defaulting on loans for buildings, including where Musk leases office space at 650 California Street in San Francisco, Fortune first reported.
Twitter has also allegedly fallen behind on payments to larger companies. According to a Platformer report on Thursday, Twitter suddenly cut off employees’ access to Slack this week after failing to pay a bill. Slack is the workplace chat and collaboration platform owned by Salesforce.
In the newest complaint, filed in California Superior Court in San Francisco, Writer says that Twitter failed to pay a bill for the relatively humble amount of $113,856.
Previously known as Qordoba, Writer describes itself as an AI company that helps employees create content that meets their employer’s standards for brand, copy, and other style guidelines.
Writer did not immediately respond to a request for a comment on the matter.
Twitter’s Vice President of Product, Trust & Safety, Ella Irwin, told CNBC via e-mail, “We do not comment on pending litigation or various speculation surrounding Twitter’s financial health.”
Musk has publicly groused about and made light of Twitter’s financial woes. This week, he wrote on Twitter, “Say what you want about me, but I acquired the world’s largest non-profit for $44B lol.”
Red flags
Nonpayment disputes like these are not common after a leveraged buyout, according to Boston College finance professor Edith Hotchkiss. She said in an email to CNBC that they are “more typical of companies that are within a very short window of filing for bankruptcy.”
Vanderbilt University finance professor Josh T. White, a former SEC economist, agreed the moves are unusual, and said litigation over nonpayment to vendors could result from “incorrect and aggressive capital structure.”
Musk’s Twitter deal was financed with around 30% debt and 70% equity at closing.
White explained that the high debt level is aggressive for a company with volatile and sometimes even negative free cash flow, such as Twitter had experienced in the past three years.
Leveraged buyouts more often target companies with stable cash flows that can be used to service debt and generate a tax shield by deducting interest expense, he wrote.
“Using more debt and less equity reduces the amount of liquid cash Musk and his equity co-investors had to contribute at closing, which can potentially generate a higher internal rate of return if the company turns out to be profitable,” White said.
Meanwhile, even after aggressive cost-cutting measures, including widespread layoffs and cutbacks on perks and infrastructure, Twitter is still probably struggling to generate positive free cash flow to pay its obligations, White suggested. “Nonpayment, and contract violations are certainly a red flag that the company is likely financially distressed.”
United Launch Alliance Atlas V rocket carrying the first two demonstration satellites for Amazon’s Project Kuiper broadband internet constellation stands ready for launch on pad 41 at Cape Canaveral Space Force Station on October 5, 2023 in Cape Canaveral, Florida, United States.
Paul Hennessey | Anadolu Agency | Getty Images
Amazon delayed the launch of its Kuiper internet satellites due to poor weather conditions on Wednesday night.
A United Launch Alliance rocket carrying 27 Kuiper satellites was set to lift off from a launchpad in Cape Canaveral, Florida, but ULA said it couldn’t continue countdown operations as “stubborn cumulus clouds” and heavy winds pushed the launch outside its planned window, according to a livestream.
“Weather is observed and forecast NO GO for liftoff within the remaining launch window at Cape Canaveral this evening,” ULA said. The company said it will provide a new launch date at a later point.
Six years ago Amazon unveiled its plans to build a constellation of internet satellites in low Earth orbit, a region of space that’s within 1,200 miles of Earth’s surface. The company aims to sell high-speed, low-latency internet to consumers, corporations and governments, offering connections through square-shaped terminals. Commercial service is expected to come online later this year.
Amazon is racing to compete with SpaceX’s Starlink, the dominant player in the market, with 8,000 satellites already up in the air. SpaceX CEO Elon Musk now has a central role in the White House as one of President Donald Trump’s top advisors, overseeing the Department of Government Efficiency, or DOGE. Since Musk took on the role, Starlink’s footprint has increased within the federal government.
The clock is ticking for Amazon to meet a deadline set by the Federal Communications Commission, which requires the company to have half of its total constellation, or 1,618 satellites, up in the air by July 2026.
Once it completes its first launch, Amazon expects to ramp up its production, processing and deployment rates. It’s begun prepping satellites for its next mission, which will also hitch a ride on one of ULA’s Atlas V rockets.
Alphabet CEO Sundar Pichai meets with Polish Prime Minister Donald Tusk in Warsaw, Poland, on February 13, 2025.
Klaudia Radecka | Nurphoto | Getty Images
Google has reversed a policy forbidding employees from discussing its antitrust woes following a settlement with workers.
The company sent a notice to U.S. employees last week saying it rescinded “the rule requesting that workers refrain from commenting internally or externally about the on-going antitrust lawsuit filed against Google by the U.S. Department of Justice,” according to correspondence viewed by CNBC.
Google settled with the Alphabet Workers Union, which represents company employees and contractors, according to the U.S. National Labor Relations Board, or NLRB. The settlement and policy reversal mark a major victory for Google staffers, who have seen increased censorship on subjects such as politics, litigation and defense contracts by the search giant since 2019.
The U.S. Department of Justice filed an antitrust lawsuit against Google in 2020, alleging that the company has kept its share of the general search market by creating strong barriers to entry and a feedback loop that sustained its dominance.
Google said it “will not announce or maintain overbroad rules or policies that restrict your right to comment, internally or externally, about whether and/or how the on-going antitrust lawsuit filed against Google by the U.S. Department of Justice may impact your terms and conditions of employment,” according to last week’s notice.
The reversal comes as Google and the DOJ prepare to return to the courtroom for their scheduled remedies trial on April 21. The DOJ has said it is considering structural remedies, including breaking up Google’s Chrome web browser, which it argues gives Google an unfair advantage in the search market.
A U.S. District Court judge ruled in August that Google illegally held a monopoly in the search market. Google said it would appeal the decision. The DOJ doubled down on its calls for a breakup in a March filing.
Following the August ruling, Kent Walker, Google’s president of global affairs, sent a companywide email directing employees to “refrain from commenting on this case, both internally and externally.”
Shortly after, the Alphabet Workers Union filed an unfair labor practice charge against Google with the NLRB. The union alleged that Walker’s message was an “overly broad directive” and said that a breakup could impact workers’ roles. The NLRB in March ruled that Google must allow workers to speak on such topics.
Google’s settlement states that the National Labor Relations Act gives employees the right to form, join or assist a union. It notes that Google is not rescinding its prior clarification that states employees may not speak on behalf of Google on this matter without approval from the company. The settlement also adds that Google will not interfere with, restrain or coerce workers in the exercise of their rights.
Despite the settlement, spokesperson Courtenay Mencini said Google did not agree with the NLRB’s ruling.
“To avoid lengthy litigation, we agreed to remind employees that they have the right to talk about their employment, as they’ve always been free to and regularly do,” Mencini said in a statement to CNBC.
The settlement by Google comes at a “crucial moment” ahead of the remedies trial, the Alphabet Worker’s Union said Monday.
“We think the potential remedies from this trial could have impact on our wages, working conditions and terms of employment,” said Stephen McMurtry, communications chair of the Alphabet Workers Union-CWA, told CNBC.
Apple CEO Tim Cook inspects the new iPhone 16 during an Apple special event at Apple headquarters on September 09, 2024 in Cupertino, California.
Justin Sullivan | Getty Images
Apple shares skyrocketed 15% on Wednesday after President Donald Trump announced a 90-day pause on his administration’s “reciprocal tariffs,” which would have affected the company’s production locations in Vietnam, India, and Thailand.
The rally added over $400 billion to Apple’s market cap, which now stands just under $3 trillion. It was Apple’s best day since January 1998, when late founder Steve Jobs was the interim CEO and three years before the company unveiled the first iPod. At the time, Apple’s market cap was close to $3 billion.
Apple has been the most prominent name to get whacked by Trump’s tariffs. Before Wednesday, it was on its worst four-day trading stretch since 2000. Investors worried about Apple’s outlook because the company still makes the majority of its revenue from selling physical devices, which need to be imported into the U.S.
Most of Apple’s iPhones and other hardware products are still made in China, which was not exempted from tariffs on Wednesday. In fact, Trump increased tariffs on China to 125% on Wednesday, up from 54%.
China issued an 84% tariff on U.S. goods this week, raising the possibility that Apple could get caught up in a trade war and lose ground in China, its third-largest market by sales.
Apple has worked to diversify its supply chain to lessen reliance on China in recent years.
On Wednesday, tariffs on Vietnam were reduced from 46% to 10%, and tariffs on India were cut 26% to 10%, which raises the possibility that Apple will be able to serve a large percentage of its U.S. customers from factories outside of China with lower tariffs.
Stocks skyrocketed across the board on Wednesday after Trump announced the tariff pause. The Nasdaq Composite climbed over 12%, its second-best day ever.
Apple hasn’t commented publicly on Trump’s tariffs, but CEO Tim Cook will likely address the topic on an earnings call on May 1.