A complaint filed by the landlord claims that Twitter stopped paying rent on its San Francisco headquarters in December under the ownership of new owner Elon Musk.
Sri Nine Market Square, the building’s owner, said in a complaint filed on Monday (Jan 23) in state court in California that the social network firm had failed to pay the US$3.36 million December rent for its offices at 1355 Market Street and the US$3.42 million for January rent.
The billionaire has cut expenses ever since he took control of Twitter. He has let go of half the workers, withheld rent from the business’s overseas locations, and refused to pay certain outstanding debts, including a jet rental. These steps are being taken as Musk prepares to make the first instalment of the $12.5 billion in debt he took on to buy Twitter.
The lawsuit was filed as Musk was testifying in a San Francisco securities fraud trial, where he was defending his tweet about taking Tesla private. He’s scheduled to come back on Tuesday to complete his testimony.
According to the complaint, Twitter leases more than 460,000 square feet of space across eight floors of the San Francisco skyscraper. When Musk acquired Sri Nine in October for US$44 billion, Twitter was compelled to enhance the letter of credit held by Sri Nine as collateral from US$3.6 million to US$10 million.
According to the complaint, Twitter claimed that it was not required to increase the credit line.
The line of credit’s remaining amount, according to Sri Nine, is US$1 after it was used to pay the $3.36 million in rent for December and a portion of the January rent.
In addition to getting their money back for the overdue rent, Sri Nine wants the court to rule that Twitter violated the agreement by not raising the available line of credit to US$10 million.
A request for comment was not answered by Twitter, which has shut down its PR division.
