Another day, another chapter in the Twitter and Elon Musk saga. After notifying the company he was backing out of his agreement to acquire the social network on July 8, 2022, Twitter will now go to court to attempt to force Musk to complete the $44 billion purchase. The grounds for the lawsuit stand on Twitter’s claim that they provided the billionaire with all of the information requested regarding the volume of phony accounts on the platform, a major sticking point for Musk when it came to the acquisition.
The company has claimed that only 5% of the monetizable daily active users are spam accounts, while Musk says he was never given accurate information when it came to this assertion. The legal battle is expected to take place in a Delaware court, where Twitter will seek to obligate Musk to complete the purchase at $54.20 per share, the original agreement proposed by the Space-X CEO back in late April 2022.
Twitter’s response to Musk
In response to a letter from Musk’s attorney on July 8, Twitter claimed that the attempted cancellation of the deal agreed upon by the two parties was “invalid and wrongful”, according to the company’s legal team.
In addition, the letter said “Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, [Mr.] 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’s legal team went on to say that backing out of the previously agreed upon purchase came in conflict with Musk’s personal interests, something that the company believes will not hold up in the scrutiny of the court.
“In April 2022, Elon Musk entered into a binding merger agreement with Twitter, promising to use his best efforts to get the deal done,” the letter said. “Now, less than three months later, Musk refuses to honor his obligations to Twitter and its stockholders because the deal he signed no longer serves his personal interests.”
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Social media reaction to the lawsuit
In response to the pending litigation and the letter from the company’s legal team Musk tweeted:
Oh the irony lol
— Elon Musk (@elonmusk) July 12, 2022
The feelings on the platform towards the Tesla founder have run the gamut since it was announced he would purchase Twitter back in April, with many hoping the acquisition would eventually fall through. In a twist of irony, some of those same users are now hoping the company will force the purchase solely because it is against Musk’s wishes.
Elon Musk announces he will be introducing a new twitter feature that will let you edit contracts after signing them
— 𝚃𝚑𝚎 𝙲𝚑𝚊𝚜𝚎𝚛 (@chaser) July 13, 2022
Some Twitter shareholders are openly expressing hope that the deal is canceled altogether, and that the platform remains a publicly traded company.
.@elonmusk will likely lose in some fashion the lawsuit filed by @Twitter if I had to predict. As a Twitter shareholder, it may be in my short term financial interest to vote in favor of buyout. I will be voting no bc I believe in the platform remaining a publicly traded Company
— Richard Signorelli (@richsignorelli) July 13, 2022
While others are assuming that Musk will eventually acquire the company at a discounted price, due to the lack of transparency from Twitter regarding the amount of spam accounts on the site.
@elonmusk now has the power of discovery against @Twitter and it’s board. He is now owed all of the bot calculations…and more importantly, the internal discussions as to why Twitter refuses to wipe the bots from its community. We all know they exceed 5% of daily active users.
— 🇺🇸Kyle Bass🇺🇦 (@Jkylebass) July 13, 2022
Regardless of where Twitter users stand on the issue, there is still a great deal that needs to play out, presumably in court, before this story is finally finished.