Elon Musk has launched his first counterattack in the legal dispute with Twitter: a few days after Twitter sued him to force him to complete the takeover negotiated in April, he has now countered in a letter to the responsible court in the state of Delaware. He again questioned Twitter’s calculations for the share of “spam” or “fake” accounts in its user numbers.
The letter was primarily aimed at thwarting Twitter’s efforts to seek an expedited trial. Parallel to its lawsuit last week, Twitter has applied for a four-day trial to be scheduled as early as September. Musk now suggests that court proceedings begin no earlier than February next year. The dispute over bogus user accounts is “fundamental” to Twitter’s value, and it takes time to gather facts and expertise around the issue.
Twitter’s lawsuit further increased the “complexity” of the dispute. The company had made “a mishmash of groundless new claims”. Twitter’s push for an expedited process is “a tactic to hide the truth about spam accounts.” A first hearing in the Delaware court is scheduled for Tuesday this week.
Musk agreed to acquire Twitter for $44 billion in April. Just a few weeks later, he declared the transaction “temporarily suspended” with reference to spam accounts, and just over a week ago he said the takeover had been lifted entirely. Twitter filed a lawsuit against him a few days later. The company accuses Musk of wanting to get out of the contract because the capital markets environment has clouded over and the value of his stake in Tesla and thus his assets have shrunk significantly.
Twitter described the spam account argument as “hypocrisy” and said that in direct exchanges with the company, Musk showed “little interest” in understanding how those accounts are calculated. In the legal dispute, Twitter wants to ensure that Musk must complete the acquisition at the agreed price of $54.20 per share. Twitter shares are currently valued at less than $38 on the stock exchange.
