Moments after news of Twitter suing Musk surfaced online, Tesla’s CEO took to the microblogging site and just simply tweeted, “Oh the irony lol” without referring to the legal action initiated against him.
— Elon Musk (@elonmusk) July 12, 2022 For the unversed, Musk had entered into a definitive agreement with Twitter in April 2022 to acquire the microblogging platform for approximately $44 billion. But the deal was temporarily put on hold in May 2022 for pending data, which supported the microblogging site’s claim that less than 5% of its daily active users are automated spam accounts. However, last Friday, Musk notified Twitter of his decision in a letter from his lawyers to terminate the deal for breaching “multiple provisions of the agreement”, according to a regulatory filing. Musk accused the company of denying his request to disclose information about spam accounts on the platform, which he said amounted to a “material adverse event.” He said that the information on such accounts was fundamental to Twitter’s business performance and he had previously warned that the deal would be suspended if he doesn’t get the required data. Reacting to the termination of the deal, Twitter on Tuesday filed a lawsuit against Musk in Delaware’s Court of Chancery “to hold Elon Musk accountable to his contractual obligations.” The lawsuit accused Musk of “outlandish” and “bad faith” actions as well as “a long list” of violations of the merger agreement that has brought the platform irreversible harm and “wreaked havoc” on its stock price. Twitter’s lawsuit opens with an accusation that “Musk refuses to honor his obligations to Twitter and its stockholders because the deal he signed no longer serves his personal interests.” It further added, “Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly 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. “Twitter brings this action to enjoin Musk from further breaches, to compel Musk to fulfill his legal obligations, and to compel consummation of the merger upon satisfaction of the few outstanding conditions.” Under the terms of the original merger agreement in April, Musk and Twitter had agreed to pay each other a $1 billion breakup fee if either was responsible for the deal not going through. Twitter has asked the Delaware Court to order Musk to complete the agreed merger at the agreed $54.20 per Twitter share. Apparently, the lawsuit filed by Twitter consists of 62 pages and has mentioned roughly 13 of Elon Musk’s tweets. As of now, no judge has been assigned to the case. The microblogging platform is hoping to start the case on September 19.
