Elon Musk’s controversial efforts to cut costs at Twitter has sparked a landlord to sue the company for failing to pay rent for its San Francisco office.
The dispute concerns an office at 650 California Street, which is separate from Twitter’s main headquarters on Market Street. The landlord claims Twitter owes $136,260 for leasing the 30th floor of the building, according to the lawsuit, which was first spotted by Bloomberg.
Twitter has been renting space at the building since 2017, and entered into a new sublease agreement on Oct. 5—a few weeks before Musk completed his acquisition for the social media platform. Allegedly, Twitter has since refused to pay the monthly rental fees at the office.
In response, the landlord, Columbia Reit, sent a notice to Twitter on Dec. 16 about paying the rent. The same notice warned that the landlord could terminate the master lease, evict Twitter from the office space, and initiate legal proceedings, if Twitter failed to pay within five days.
The lawsuit signals Musk is refusing to hand over the funds. Columbia Reit is now demanding the court order Twitter to pay for the missed rent and for added “interest” on monetary damages.
The legal dispute occurs when Musk has embarked on massive cost saving measures to turn Twitter into a profitable company. This has included laying off or firing over half of the staff and most recently shutting down a data center in Sacramento.
According to The New York Times, Twitter has also stopped paying millions of dollars in rents and services, which has led the company to being evicted from its Seattle office. In some cases, Twitter employees are also bringing their own toilet paper due to janitorial services being cut.
Twitter did not immediately respond to a request for comment. But last month, Musk said the company is facing a potential $3 billion deficit unless it takes extreme measures to cut costs. “This company is basically like you’re in a plane that is headed toward the ground at high speed with the engines on fire and the controls don’t work,” he said in a Twitter Spaces chat.