Elon Musk owes $61 million for servers for X – the social network is being sued

The Taiwanese company Wiwynn sued X (Twitter) for failure to pay $61 million for server equipment that was ordered before the arrival of Elon Musk. X denies all charges.

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The fact of the matter is that before Musk acquired Twitter and renamed it X, the company entered into a contract with Wiwynn to supply “custom-designed IT solutions, including server racks.” And since these products were not part of mass production, Wiwynn was forced to order components in advance. As stated in the complaint, “the components used to assemble the products are substantially unique and require significant lead times to order, and Twitter has agreed to provide written consent to purchase the necessary components and to undertake payment for them.”

However, after Musk became the owner of Twitter, relations with the server dealer began to deteriorate. According to Wiwynn, X stopped paying bills for server products it ordered and also did not respond to requests for late payments. Wiwynn alleges that X owes more than $32 million for IT products supplied, and also did not cover the costs of components that Wiwynn had already paid to other suppliers. Even though the company could sell some components to other customers, Wiwynn insists X still owes it at least $61 million.

For its part, X stated that it did not violate the terms of its contract with Wiwynn because it “did not give final approval to order equipment that Wiwynn had already purchased and supplied.” Representatives of social network X did not provide any other comments. The case is being heard in the District Court for the Northern District of California (USA).