Elon Musk Slaps Twitter With Countersuit, Escalates Conflict
Elon Musk, cryptocurrency enthusiast and super-rich guy at large, has ramped up his skirmish with Twitter as the two big names go to courtroom war.
The conflict between Tesla CEO Elon Musk and Twitter’s founders has escalated. The drama has heightened since the billionaire withdrew his offer to buy the social network. Twitter’s board of directors is suing him in an effort to make him go through with the deal.
According to CNBC, Elon Musk’s counterclaim is, for now, secret at his request. However, the 164-page document could soon be public in a redacted form.
Elon Musk and Twitter Spat Goes to Court
Chancellor Kathaleen McCormick of the Delaware court has ordered a 5-day trial between the two parties. The trial will start on October 17, with the aim of determining whether Elon Musk can withdraw from the deal. Meanwhile, the billionaire and Twitter have not issued their opinion on the matter.
On July 8, Elon Musk withdrew his $44 billion offer to buy Twitter, four months after publicly announcing his intention to acquire the social network. He alleged inconsistencies in the acquisition agreement, as well as systematic disagreements with the board of directors. In a letter sent to the U.S. Securities and Exchange Commission (SEC), it was stated:
“Twitter has still not provided much of the information specifically requested by Mr. Musk in Sections 1.01-1.03 of the May 19 diligence request list that is necessary for him to make an assessment of the prevalence of false or spam accounts on its website. As recently as the June 29 Letter, Mr. Musk reiterated this long-standing request for information related to Twitter’s sampling process for detecting fake accounts. The June 29 Letter identified specific data necessary to enable Mr. Musk to independently verify Twitter’s representations regarding the number of mDAU on its platform.”
“A subsequent request along these lines should not have been necessary, as this information should have been provided in response to Mr. Musk’s original diligence request. Yet, to date, Twitter has not provided any of this information.”
Twitter Brings Friends Along for the Ride
The British newspaper The Guardian revealed that Elon Musk was also sued by Twitter shareholder Luigi Crispo (who has 5,500 shares). Crispo asked the court to order Musk to close the deal and accused him of breaching his fiduciary duty to the shareholders of the social network. Crispo wouldalso like Musk to grant resources to repair damages for the losses caused.
After Elon Musk’s announcement to withdraw from the offer, Twitter’s board responded. They claim that the tycoon’s accusations that Twitter has not provided the real information about the platform are false. Therefore, there is no argument that allows the millionaire to withdraw from the purchase.
According to Twitter, “It’s not a big surprise to anyone that Musk is trying to abandon the deal. However, the problem is that this whole saga was quite disruptive in recent months, which could affect Twitter’s performance not only in the second quarter but also in the third.”
Musk does not seem allergic to any kind of scandal. Recently, he was accused of being naughty with Sergey Brin’s wife, Nicole.
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