Concerning: Elon Musk’s X Corp. files lawsuit against Atlas over alleged unpaid rent

I·ro·ny  /ˈīrənē/: a state of affairs or an event that seems deliberately contrary to what one expects and is often amusing as a result.

X Corp., formerly known as Twitter, has filed a lawsuit against fintech startup Atlas Exploration Inc. for alleged nonpayment of rent and fees totaling nearly $1.5 million, the San Francisco Business Times reported.

The complaint, which was filed in the San Francisco Superior Court, claims that Atlas, which previously operated as Point Up Inc., failed to pay a $1.1 million termination fee and rent for September, October, and November 2022 after terminating its sublease for office space at 650 California Street. 

X Corp. originally leased the 15,500-square-foot space in 2017, with Atlas taking it over in April 2021 under a lease agreement extending until January 2025. However, Atlas sought early termination at the end of 2022.

X Corp. has used a $740,000 letter of credit from Atlas to partially cover the owed sum but is still pursuing the remaining $700,000, along with interest and additional costs. 

The lawsuit marks a reversal for X Corp., which faced multiple lawsuits for unpaid rent shortly after Elon Musk’s acquisition of the company at the end of 2022, including a suit from Columbia Property Trust regarding unpaid rent at 650 California Street. Although that particular suit was dismissed in April, the reasons behind the dismissal remain unclear.

Atlas has since brought in Dentsu Inc. to replace them as X Corp.’s subtenant at 650 California Street. Atlas vacated the space in August 2022, and Dentsu began paying rent from December of that year. Atlas currently operates from 333 Bush St., according to its website. Attorneys for both X Corp. and Atlas declined to comment on the lawsuit.

In February, An LLC controlled by Synergy Investments sued the social media company in Massachusetts’ Suffolk Superior Court, the Boston Globe reported. Twitter is a tenant at the Center Plaza, a Boston office near City Hall. The lawsuit states Musk’s company has failed to pay rent for the preceding, racking up more than $632,000 in arrears.

In May, the social media giant was hit with an eviction in Boulder, Colorado, the Denver Business Journal reported. The “writ of restitution” filed by a judge gives the sheriff 49 days from May 31 to evict Twitter.

The company occupied four office suites at 3401 Bluff Street since 2020, when it signed on for the 65,000-square-foot space. At one point, as many as 300 employees worked out of the location, which is owned by an affiliate of The John Buck Company.

— Ted Glanzer