Twitter sues Elon Musk for giving up on acquisition deal - 9to5Mac
source link: https://9to5mac.com/2022/07/12/twitter-sues-elon-musk-acquisition-deal/
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Twitter sues Elon Musk for giving up on acquisition deal
Elon Musk confirmed last week that he was officially giving up on the deal he made with Twitter back in April in which he promised to buy the social media platform for $44 billion. Now Twitter is suing Musk for not honoring the deal.
In a lawsuit filed in the Delaware Court of Chancery against Musk on Tuesday (via The Verge), Twitter claims that the billionaire refuses to fulfill his “obligations” when it comes to the agreement made earlier this year.
The original deal included a $1 billion penalty clause if Musk backed out of the deal. However, backing out of a merger agreement is not so easy, and Twitter now wants Musk to be forced to complete the $44 billion acquisition. Musk responded to the lawsuit with a tweet saying “Oh the irony lol,” while a Twitter spokesperson declined to comment.
Before Elon Musk confirmed his intentions to buy Twitter, he had already invested nearly $3 billion in the social media platform, which gave him about 10% of the company’s shares. A few weeks later, Twitter accepted Musk’s offer in a deal that was expected to be completed later this year.
Last Friday, Musk wrote a letter to Twitter in which he officially notified the company about pulling out of the acquisition deal. The Twitter deal had already been put “temporarily on hold” by Musk as he claimed to be unhappy with the number of bots and spam accounts on the social network. For some analysts, this was just an excuse to cancel the acquisition.
Musk wanted a escape.
In the words of Twitter’s lawyers, Musk “wanted an escape” from the deal, but the merger agreement left him “little room.” The lawsuit features several examples of Musk’s public statements criticizing Twitter and its employees in an attempt to damage the platform’s reputation.
Twitter also claims that Musk never asked the company about the number of spam accounts before the agreement was set. The company is now urging the case to go to trial in September, a month before the “drop-dead” deadline.
The law firm chosen by Twitter in this case was “Wachtell, Lipton, Rosen & Katz,” which has represented clients such as AT&T, Pfizer, and JP Morgan Chase. Musk, on the other hand, has hired “Quinn Emanuel Urquhart & Sullivan,” the firm that was responsible for the defense of Samsung against Apple’s patent lawsuit.
At this point, it’s unclear what will happen next between Musk and Twitter.
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