Elon Musk Sued by Twitter for Trying to Back Out of $44 Billion DealJuly 13, 2022
Filed in Delaware’s Court of Chancery, the lawsuit accuses the world’s richest person and Tesla founder of hypocrisy and bad faith in violating his contract with Twitter.
AceShowbiz -Twitter officially sued Elon Musk on Tuesday, July 12 for calling off his $44 billion deal to buy the social media platform. Filed in Delaware’s Court of Chancery, the lawsuit accuses the world’s richest person of hypocrisy and bad faith in violating his contract with Twitter.
The blue bird app company claims that Elon now “refuses to honor his obligations to Twitter and its stockholders because the deal he signed no longer serves his personal interests” even after entering a binding merger agreement. “Musk apparently believes that he – unlike every other party subject to Delaware contract law – is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away,” the company says in the suit.
It is said that in order to terminate the deal, Elon claims that Twitter balks at handing over information about spam bots, also known as fake accounts, on the platform. He further says that Twitter intentionally misled the public and obstructed his efforts to get more information about how it accounts for the figures. However, the lawsuit notes that he’s under a legally binding contract.
The suit also adds that what the Tesla founder says about why he wants to terminate the deal, including the prevalence of bots on the service, are “pretexts.” It continues, “Since signing the merger agreement, Musk has repeatedly disparaged Twitter and the deal, creating business risk for Twitter and downward pressure on its share price.” Twitter hopes to “hold Elon Musk accountable to his contractual obligations” with the suit.
As the deal has a deadline of October 24 to be completed, Twitter is seeking a four-day trial this September. If the transaction is still awaiting regulatory approval at that time, the two parties will have another six months to close it.
Attorney William Savitt and other lawyers representing the social media company wrote, “Musk wanted an escape. But the merger agreement left him little room.” Meanwhile, Elon appeared to respond to the lawsuit in a tweet which read, “Oh the irony lol.” Neither he nor his reps offer an official statement in response to Twitter’s lawsuit.
Elon Musk appeared to respond to Twitter’s lawsuit.
Prior to this, Elon accused the microblogging website of lying about the number of bots and spam accounts on the platform, as well as failing to provide material he asked for. “This information is fundamental to Twitter’s business and financial performance and is necessary to consummate,” his buyout letter read. “Twitter has failed or refused to provide this information. Sometimes Twitter has ignored Mr. Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr. Musk incomplete or unusable information.”
He claimed that he made “provided numerous additional follow-up requests,” but Twitter “did not comply” with its obligations. The letter concluded, “Accordingly, for all of these reasons, Mr. Musk hereby exercises X Holdings I, Inc.’s right to terminate the Merger Agreement and abandon the transaction contemplated thereby, and this letter constitutes formal notice of X Holding I, Inc.’s termination of the Merger Agreement.”
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