Elon Musk Responds to Twitter’s $44 Billion Deal

Elon Musk Responds to Twitter's $44 Billion Deal
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Elon Musk In its first official response to him on Friday, Twitter accused him of misleading him about its service, misrepresenting the facts and failing to notify him of executive changes. company claim aimed to force it to complete its $44 billion acquisition of the social media service.

Solicitors for Mr. Musk, who landed a blockbuster deal Although it tried to buy Twitter in April, it has since tried to stop the purchase, the lawsuit argued in a legal filing aimed at defying the company’s request for a four-day trial in September.

Twitter rushes to court after “two months of delays, technical bottlenecks, evasive responses and finally denials.” Musk’s lawyers said in the filing. They added that Twitter was trying to “cover up the truth”. fake accounts on the service, a matter that mr. Musk became the focus of the bid to withdraw from the deal.

Twitter requested testing in September because Mr. Musk had until October to close the deal to buy the company. 24. Mr. Musk’s lawyers proposed a February trial date, noting that the contract is automatically extended in the event of litigation. Banks that have committed to help finance the deal have pledged to fund it until April 25, 2023.

Mr. Musk’s legal filing was a strong rebuttal to accusations that Twitter was trying to end the acquisition unfairly. In this week’s Twitter lawsuit, Mr. Musk “knowingly, willfully, willfully and materially breached” his agreement to buy the company, claiming he had no knowledge of the proliferation of fake accounts on the service.

Next legal battle it promises to be ugly and long. The back-and-forth between the two sides had escalated for weeks before reaching court. Mr. Musk has made barbed comments about the company and often questioned the proliferation of fake accounts on the platform. Fake accounts are used to spread spam or manipulates Twitter’s service by falsely increasing trends and is often automated rather than by real people.

At one point mr. Musk announced on Twitter that the contract with Twitter has been terminated. His moves coincided with a drop in the value of tech stocks, including Tesla, Mr. Tesla’s electric car maker. Musk is in charge and this is the main source of his wealth.

Twitter claimed to be working with Mr. Musk intends to close the deal and complete the sale. In the settlement agreement, Twitter and Mr. Musk has a so-called special performance clause that allows the company to sue to force the deal as long as the billionaire has debt for the buyout.

A Twitter spokesperson declined to comment.

Ann Lipton, a professor of corporate governance at Tulane Law School, said it’s clear why Twitter is moving so fast, and Mr. It wasn’t Musk.

“The Twitter board has an interest in getting this resolved quickly, and it has every interest in delay — time is money,” he said. Mr. Musk added: “He’s going to want to do as much discovery as possible and spend as much time as possible, essentially forcing the threat of the litigation itself and the uncertainty associated with it over time to sort of force a settlement or a retreat.”

In legal documents, Mr. Musk’s lawyers repeated many of the same arguments they made this month when they said the billionaire intended to scrap the deal.

Twitter did not keep a strict count of fake accounts and suspended Mr. Trump. Musk’s efforts to understand how spam is calculated, the filing says. “Musk was stunned to learn how trivial Twitter’s process was,” he said, noting that the company uses humans to understand data, not machine learning.

Mr. Musk tried to get more information about the fake accounts from Twitter, but the company “deliberately erected artificial barriers and frustrated the efforts of advocates.”

To determine how Twitter counts fake accounts, Mr. Musk needed months of discovery and dozens of depositions, his lawyers said. Mr. Musk argued that Twitter’s public statements that fake accounts make up about 5 percent of active users were misleading. Incorrect numbers can be a “material adverse effect” under the terms of the deal, and Mr. Prof. Musk walked away, his lawyers said, arguing that the numbers were “directly related to Twitter’s prospective value to users and advertisers.”

There is Twitter made mistakes with user numbers earlier, Mr. This was reported by Musk’s lawyers. In April, the company said it had overcounted its active users from 2019 to 2021.

The company said in its lawsuit that it informed Mr. Musk’s attorneys said of the two executives that the attorneys had “no objections.”

Twitter and Mr. Musk’s court hearing in the case will be held on Tuesday at 00:00 Court of Chancery in Delaware, where the company filed a lawsuit against the billionaire. Court chancellor Kathaleen St. J. McCormick has been tasked with overseeing the case and will decide whether to expedite the case as requested by Twitter or delay it for Mr. McCormick. Musk.

If the lawsuit goes to trial, Judge McCormick will appoint Mr. McCormick. Musk needs to close the deal. He could also allow Messrs. Musk walks away while forcing him to pay compensation. With much reading of Twitter’s contract with mr. Musk said that the damage will be limited to 1 billion dollars. Both parties may terminate or renegotiate the agreement.

Twitter has lost about a third of its value since Mr Trump. Musk signed an agreement to buy one share of the company for $54.20. The company plans to report quarterly earnings next Friday.

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