Tesla’s billionaire CEO abruptly withdrew his $44 billion takeover bid from the microblogging site after months of public tussle.
Twitter wants a Delaware court presided over by Chancellor Kathaleen McCormick to compel Musk to honor his original pledge. A five-day trial is scheduled to start on October 17.
Pending the start of a trial whose outcome could have a big impact on mergers and acquisitions in the future, the two parties have been clashing with subpoenas. After initially explaining that he was giving up on Twitter because management had lied about the number of spam bots, or fake accounts on the platform, the billionaire then provided two other reasons.
He revealed in a letter sent to Twitter on September 10 that he was ending their deal due to to a purported $7.75 million severance payment the company made to its former head of security Peiter “Mudge” Zatko, who later alleged that Twitter has security and privacy vulnerabilities.
Does Twitter Censor Musk?
“Twitter did not seek defendants’ consent (…) before making this payment nor was this payment disclosed to defendants,” Musk’s lawyers wrote in the letter. “In fact, defendants only learned of this payment when Twitter filed the separation agreement with the court on September 3, 2022.”
This severance “violated” terms of the deal, Musk argued.
“Defendants are thus not required to close (…) and have an additional basis to terminate the merger agreement.”
Twitter slammed the claim, explaining in a regulatory document filed on Sept. 12 that the move was “invalid and wrongful.”
Musk has just launched a new attack on Twitter. He claims in messages posted to his 105.6 million followers on the platform that his tweets are deleted by the social network without however providing proof.
“My tweets are being suppressed!” the billionaire posted on Sept.13.
A few minutes after this message he sent another in which he asked the CEO of Twitter Parag Agrawal to solve the problem.
“Please fix @twitter, @verified, @paraga.”
About forty minutes later he posted a meme with the words: “Help! Help! I’m being repressed!”
These messages were sent on the same day that the Twitter whistleblower was testifying in Congress and the platform’s shareholders were voting on the acquisition offer.
Musk Makes Curious Changes
Twitter shareholders gave the go head for Tesla Musk to acquire the social media and take it private. Based on a preliminary tabulation of the stockholder vote, approximately 98.6% of the votes cast at the special meeting approved the proposal to adopt the deal, the company said in a statement.
“Twitter stands ready and willing to complete the merger with affiliates of Mr. Musk immediately, and in any event, no later than on September 15, 2022, the second business day following the satisfaction of all conditions precedent, which is the timeline required by the merger agreement.”
At the same time, whistleblower Zatko, a respected cybersecurity expert, testified before the US Senate on what he described as serious vulnerabilities of Twitter in terms of security and privacy.
“I am here today because Twitter leadership is misleading the public, lawmakers, regulators and even its own board of directors,” Zatko told the lawmakers as he began his sworn testimony.
“They don’t know what data they have, where it lives and where it came from and so, unsurprisingly, they can’t protect it,” Zatko said. “It doesn’t matter who has keys if there are no locks.”
“Twitter leadership ignored its engineers,” he added, in part because “their executive incentives led them to prioritize profit over security.”
It is also interesting to note that on the same day Musk changed his name on Twitter to “Naughtius Maximus.” He also changed the display picture of his profile to a photo of him as a child. His bio now reads “Centurion in Jerusalem Garrison.”
These changes seem to refer to Rome under Julius Caesar.