In a recent legal development, a federal judge has ruled that X, formerly known as Twitter, must face a lawsuit filed by former employees who accuse the company of reneging on promised bonuses. The judge denied X's motion to dismiss the case, allowing it to proceed.

The lawsuit, filed in June 2023 by Mark Schobinger, a former senior director of compensation at X, seeks class action status for current and former employees who did not receive their 2022 bonuses. The legal action alleges that X failed to fulfill its commitment to pay out annual bonuses, despite assurances from executives both before and after the acquisition by billionaire Elon Musk in October 2022.

US District Judge Vince Chhabria deemed Schobinger's case against X to be plausible, stating that "Twitter's offer to pay him a bonus in return became a binding contract under California law." This ruling paves the way for the lawsuit to proceed further.

X, which has largely dismantled its public relations team, did not provide any response to CNN's request for comment on the matter. In their motion to dismiss the case, X argued that an oral promise should not be legally binding and also contended that the lawsuit should be transferred to Texas. Nevertheless, Judge Chhabria asserted that California law applies to matters of contract enforcement.

According to the June complaint, concerns regarding compensation and annual bonuses were raised by many employees after the announcement of Musk's acquisition of X in April. Executives at the company repeatedly assured employees in the months leading up to the acquisition that 2022 bonuses would be paid at 50% of the target. These promises were reiterated even after the acquisition had taken place, as mentioned in the complaint.

However, X failed to honor these assurances, leading to dissatisfaction among employees. Schobinger, who left the company in May, cited Twitter's failure to fulfill its promises, including the non-payment of bonuses, as the reason for his departure, as stated in the complaint.

The lawsuit now moves forward, aiming to hold X accountable for its alleged failure to pay promised bonuses. As the legal battle unfolds, both current and former X employees affected by this issue will be watching closely to see if justice is served.

It remains to be seen how this lawsuit will impact X's reputation and if it will prompt the company to reconsider its compensation practices moving forward. As the case progresses, more details are likely to emerge, shedding light on the intricate dynamics between X, its employees, and Elon Musk's acquisition of the social media platform.