Wachtell, Lipton, Rosen & Katz, a well-reputed law firm, has successfully compelled X Corp.’s lawsuit into arbitration using an order by a San Francisco County Superior Court judge. The order was issued on Monday, effectively putting a halt on X Corp.’s litigation process.
This development follows the lawsuit filed by X Corp. against Wachtell in July, objecting to a $70 million success fee procured by the law firm. The acquisition of this substantial fee from X Corp.’s prior board was prompted by Twitter’s impending purchase expedited by billionaire Elon Musk. Musk had initially attempted to renounce the deal, leading to Twitter’s engagement with Wachtell.
In their dispute, X Corp. contended that Wachtell’s strategy to secure the $70 million success fee should be categorized as equitable relief, invoking a carve-out in Wachtell’s arbitration clause. However, the recent judicial decision has moved the case into arbitration.
This presents a notable shift in the legal tussle between Wachtell and X Corp. and shows the intricate dealings and processes involved in significant corporate transactions. Future developments in this case could have implications for similar arbitration scenarios in corporate litigation.