WordPress CEO “Lighter” After Layoffs Amidst Trademark Dispute
Matt Mullenweg, CEO of WordPress and co-founder of Automattic, shared that he feels “much lighter” after laying off 159 employees as a result of his attempt to pressure WP Engine, a competitor, into licensing trademarks it had used for years.
Mullenweg believes that WP Engine, which hosts WordPress sites, does not sufficiently support the WordPress community while taking advantage of open-source software. As a result, he proposed a licensing agreement under which WP Engine would either pay 8% of its gross monthly revenue to Automattic or allocate an equivalent amount of developer time to further WordPress development.
WP Engine, backed by venture capital firm Silver Lake, refused to sign the proposed terms, deeming its use of the trademarks lawful. This led to public disagreements, mutual accusations, and the blocking of theme and plugin updates on WP Engine-hosted sites via WordPress.org. However, after strong community backlash, Mullenweg paused the block to allow WP Engine time to set up its own update server.
As the conflict escalated, WP Engine filed a federal lawsuit against Mullenweg and Automattic. The lawsuit accuses them of attempted extortion, defamation, unfair competition, and other misconduct. It also questions the legitimacy of trademark management, which was transferred to the nonprofit WordPress Foundation in 2010 to prevent abuse. Mullenweg, who serves as director of the foundation, is suspected of misreporting tax filings, concealing the transfer of trademark rights to Automattic, a for-profit entity.
Automattic denies all accusations, calling the lawsuit “baseless.” Meanwhile, the fallout from the conflict has already impacted the company and its subsidiaries. Mullenweg offered employees who disagreed with his actions a “buyout package”—either $30,000 or six months’ salary, whichever was greater.
A total of 159 employees, representing 8.4% of the workforce, accepted the offer and left the company. Most of those who departed were working in divisions related to the WordPress ecosystem. Mullenweg responded to the departures with a quote from Churchill: “Never let a good crisis go to waste.”
This conflict vividly illustrates the fine line between protecting community interests and abusing power in the world of open-source software. It serves as a reminder that even in projects founded on the ideals of collaboration and the common good, personal ambitions and corporate interests can lead to actions that undermine the very principles on which those projects are built.
It stands as a warning to tech company leaders: they must carefully weigh the long-term consequences of their decisions, mindful of the delicate balance between commercial success and loyalty to the values of the open-source community.
