In its struggle to pressure Elon Musk to honour his settlement to purchase Twitter for $44bn, the social media firm has armed itself with the billionaire’s personal tweets.
Twitter’s fiery lawsuit depicts Musk as unserious concerning the deal and accuses the Tesla chief govt of repeatedly violating the merger contract governing the acquisition. His cavalier perspective and flagrant misconduct underneath the phrases of the settlement have been self-evident over the previous few months, the corporate claimed, pointing to his frequent jabs at Twitter and its management on the platform itself.
“For Musk, it would seem, Twitter, the interests of its stockholders, the transaction Musk agreed to, and the court process to enforce it all constitute an elaborate joke,” attorneys for Twitter wrote in courtroom papers filed within the Delaware chancery courtroom on Tuesday.
The punchy doc, filed along with an utility from Twitter for the trial to be expedited to September, units the stage for a high-stakes authorized stand-off between one of many world’s richest males and considered one of Silicon Valley’s most influential social media platforms.
The two events might settle or negotiate a deal at a lower cost than the $54.20 initially agreed. But authorized consultants argue that for now, Twitter has the sting.
“We already knew Musk’s claims were weak. Twitter’s complaint hammers that home,” stated Ann Lipton, a company regulation professor at Tulane University.
The characterisation of the deal, she stated, is that Musk “decided to buy Twitter on a lark, essentially that he bullied the board into taking this deal and now he’s treating it as a plaything and walking away because the market dropped . . . while hurting Twitter stockholders”.
In the times earlier than negotiations started Musk had written on Twitter “love me tender”, an allusion to a hostile tender supply he might have pursued if the Twitter board had not engaged.
Musk had described the merger contract he had proposed as “seller-friendly”, and the ultimate doc — which incorporates just about no escape hatches for Musk, Twitter has argued — was shortly finalised at Musk’s behest the evening earlier than Twitter’s board formally accepted the deal.
Musk’s major purpose for strolling away from the deal, based on a letter his attorneys despatched to Twitter final Friday, was that the corporate had failed to supply sufficient info so he might calculate what number of accounts have been bots or faux.
Twitter stated within the submitting that it had gone above and past in offering particulars to Musk’s crew to assist them perceive how the corporate evaluated the veracity of its accounts — solely ever holding again sure info to guard privateness of its customers. Musk, nonetheless, confirmed “little interest” in actually understanding how the corporate got here to estimate the variety of spam accounts, it stated.
“From the outset, defendants’ information requests were designed to try to tank the deal. Musk’s increasingly outlandish requests reflect not a genuine examination of Twitter’s processes but a litigation-driven campaign to try to create a record of non-cooperation on Twitter’s part,” it wrote.
In tweet from May 17, Musk wrote on Twitter “20% fake/spam accounts, while 4 times what Twitter claims, could be *much* higher . . . this deal cannot move forward”. The firm stated it was considered one of a number of tweets he made that violated each his obligation to not disparage the corporate and to assist shut the deal.
The submitting additionally contained recent particulars from behind the scenes, revealing how tense and chaotic the connection had develop into even because the events wanted to co-operate — for Twitter shareholders to get their money and for Musk to get management of the media firm.
Musk bombarded Twitter with knowledge requests associated to his purported issues about faux accounts. But one time, when he was set to satisfy with Twitter chief govt Parag Agrawal and its finance head, Ned Segal, Musk bailed and requested the dialogue between the perimeters to as a substitute concentrate on “the pro forma financials for the debt”.
Twitter stated it had been reassured that Musk had initially retained former Intel chief govt Bob Swan as his adviser on the transaction, solely to be taught through textual content message that Musk had dumped Swan in late June.
“Over the ensuing days, Twitter’s repeated requests for a contact in lieu of Swan generated no response. Outreach by Goldman Sachs and J.P. Morgan to Morgan Stanley likewise was met with silence,” the grievance stated.
At one level when Twitter grew to become involved concerning the standing of the $13bn in debt financing that had been pledged to the deal, Musk texted Agrawal and Segal writing, “Your lawyers are using these conversations to cause trouble. That needs to stop.”
Twitter argues that Musk breached his obligation to do all the pieces he might to safe financing for the deal. Eric Talley, a regulation professor at Columbia, stated: “There is a strong patina in the opinion saying . . . not only did [Musk] not attempt to [finalise the financing], he actively was working to kneecap the deal, to get the debt financiers to fall back.”
Musk didn’t reply to a request for remark. After the lawsuit was filed, he wrote on Twitter: “Oh the irony lol.”
Twitter wrote that it expects a shareholder vote to happen as early as mid-August. Rather than damages, it’s asking the courtroom to bind Musk to shut the deal because it says the contract requires.
Musk’s irreverence had lengthy been central to his persona, and he has largely skated free when confronted with varied authorized threats previously. In this occasion, Twitter hopes to impress on the courtroom that the mogul had gone too far.
“[The complaint] was definitely designed to try to give a sense of just how from Twitter’s perspective, even for a Silicon Valley company, it was hard to deal with what they alleged to be this type of sophomoric behaviour,” Talley stated.
Source: www.ft.com