Twitter Hires Top Legal Firm, Prepares To File Lawsuit Against Elon Musk Next Week: Report
In June, Musk had threatened to back out of the deal and accused the microblogging website of breaching the merger agreement by not providing the data he sought on spam and fake accounts.
New Delhi: Twitter is looking to sue Tesla and SpaceX CEO Elon Musk after the much-hyped $44 billion Twitter deal was terminated by the world’s richest billionaire alleging multiple breaches of the agreement. The microblogging site is gearing up to sue Musk and also hired a large New York-based law firm Wachtell, Lipton, Rosen & Katz LLP, news agency ANI reported citing The Hill. Twitter will file its lawsuit in Delaware next week. On the other hand, Musk will be represented by the law firm Quinn Emanuel Urquhart & Sullivan.
On terminating the deal, Twitter's chairman Bret Taylor had said, "The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery."
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Musk announced backing out of the $44 billion Twitter deal in a letter sent by Musk's team to Twitter on Saturday.
Musk terminated the deal due to multiple breaches of the purchase agreement. Musk’s team argues that the proportion of spam and fake accounts is "wildly higher" than 5 per cent, according to the letter.
"As further described below, Musk is terminating the Merger Agreement because Twitter is in material breach of multiple provisions of that Agreement," the letter said on Friday. "
"In short, Twitter has not provided information that Musk has requested for nearly two months notwithstanding his repeated, detailed clarifications intended to simplify Twitter's identification, collection, and disclosure of the most relevant information sought in Musk's original requests."
In April, Musk cracked a deal to acquire Twitter in a transaction valued at approximately $44 billion at $54.20 per share. However, later the deal was put on hold in May to review Twitter's claim that less than 5 per cent of accounts on the platform are bots or spam.
In June, Musk had threatened to back out of the deal and accused the microblogging website of breaching the merger agreement by not providing the data he sought on spam and fake accounts.
Musk alleged that Twitter is "actively resisting and thwarting his information rights" as outlined by the deal, CNN reported, citing the letter he sent to Twitter's head of legal, policy and trust, Vijaya Gadde.
Musk demanded that Twitter turn over information about its testing methodologies to support its claims that bots and fake accounts constitute less than 5 per cent of the platform's active user base, a figure the company has consistently stated for years in boilerplate public disclosures.
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