SAN FRANCISCO: As their legal battle intensifies, Elon Musk has accused Twitter of fraud, claiming the social media network misled him about important aspects of its business before he agreed to a $44 billion takeover.
As part of his defence against Twitter’s lawsuit attempting to compel him to complete the acquisition, which he has attempted to cancel, the Tesla CEO filed the claim late on Thursday.
In a court filing in Delaware, Musk claimed that the platform’s actual user base is around 65 million fewer than the 238 million reported by the company.
According to the claim, Twitter’s disclosures have gradually come undone because the company has been desperately trying to keep the Musk Parties from discovering its wrongdoing by aggressively locking down information.
The trial is scheduled to begin on October 17, and Musk is requesting that the judge release him from the contract and order Twitter to pay him damages.
Billions of dollars are at risk, but Twitter’s survival is also in jeopardy because of Musk’s absolutist attitude that the social media platform should permit any legal speech. This approach has raised concerns that the network might be used to promote violence.
Twitter dismissed the “mercurial billionaires” claim in its own submission, labelling it “as improbable and untrue as it sounds.”
Musk claims that Twitter tricked him into signing a $44 billion acquisition agreement despite his advice from Wall Street bankers and lawyers and his status as the billionaire founder of many companies. Twitter denied this claim.
Musk’s countersuit, which was eventually made public on Thursday, was filed last week. It included a legal argument to refute Twitter’s assertion that Musk is contractually obligated to finish the takeover transaction.
The businessman claimed that Twitter not only misled him but also US market regulators.
20 per share offer in April, but then claimed in July that he was ending their contract because the company had misled him about its count of phoney and spam accounts.
Twitter has maintained that fewer than 5% of activity on the network is the result of software bots as opposed to actual users. Shares of Twitter were up roughly 3.5% on Friday at $42. 51.
The social media platform told the court that Musks claim that the false account figure tops 10% is untenable.
Twitter also challenged Musk’s claim that he has the freedom to leave if its bot count is discovered to be inaccurate, given that he didn’t do any research before making the buyout offer.
The business claims that Musk invented a tale to get out of a merger arrangement that he no longer found appealing.
Twitter has complied in every respect with the merger agreement, the company said in the filing made to Chancery Court.
The fact that Musk’s counterclaims are based on fabrication, misrepresentation, and plain fraud makes no difference.
A vote on the merger has been scheduled for September 13 after the social media platform asked shareholders to support the agreement.
While fielding questions at an annual Tesla shareholders meeting Thursday, Musk was asked whether his potential ownership of Twitter might distract from his running of the electric car company.
He laughs, amid laughter and applause, “I think Tesla, you know, would continue to perform extremely well even if I was kidnapped by aliens or went back to my home planet.”
To be honest, Musk continued, “I don’t have an easy answer.”
He reassured investors that he does not currently have any plans to step down from his position as CEO of Tesla.
Musk accuses Twitter of fraud as the takeover dispute intensifies.
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