August 10, 2022
Twitter seeks evidence on Elon Musk’s attempted torpedo  billion deal

Twitter seeks evidence on Elon Musk's attempted torpedo $44 billion deal

Legal experts said Twitter is looking for Musk’s motivation to back out of the deal. (file)

Wilmington:

Legal experts said Twitter Inc. is attempting to find evidence that Elon Musk tried to torpedo the financing of his $44 billion takeover deal for the social media company while trying to back his way from the deal. See also inspiration.

Twitter sent dozens of civil summons this week to global banks such as entities of Morgan Stanley, an affiliate of Brookfield Asset Management Inc. and co-investors in the deal, including Musk advisors, according to filings in the Delaware courtroom over the past two days. Chancery.

Morgan Stanley declined to comment. Brookfield did not immediately respond to a request for comment. Representatives for Musk and Twitter could not be reached.

Summons Deals seeks documents and communications relating to any information on its financing, “bots,” or fake, Twitter accounts. They also want information on whether the recipients could potentially impact the deal from a change in the stock price of electric car maker Tesla Inc., of which Musk is chief executive officer.

The summons are part of Twitter’s lawsuit against Musk seeking to hold him for the deal at the $54.20 per share price he had agreed to. The five-day trial is scheduled to begin October 17 in the Delaware Chancery Court.

Experts said the summons indicate that Twitter wants to know what lenders, investors and advisors were saying to each other about Musk’s behavior after signing the deal in late April.

“He suspects behind the scenes he’s plotting to blow up the whole thing,” said Yukon School of Law professor Minor Myers.

Musk said on July 8 he was withdrawing from the deal because Twitter allegedly violated the deal by withholding data about fake accounts on the platform. Twitter has said the fake accounts distract attention from the only issue that matters, which are the terms of the agreement. Musk also said that he was walking away because Twitter fired high-ranking executives and a third of the talent acquisition team, “abandoning Twitter’s obligation to adequately protect the physical components of its current business organization.” Violated.”

According to legal experts, Musk cannot be ordered to close the deal if the funding fails – provided that is not the reason for the failed funding.

Twitter’s subpoenas focused on what it said was the firing of Bob Swan, an operating partner at venture capital firm Andreessen Horowitz, who initially led Musk’s efforts to finalize deal finance. According to Twitter’s lawsuit, he was replaced by longtime Musk aide Antonio Gracias.

Brian Quinn, a professor at Boston College Law School, said Twitter wanted to know if “Gracious had any role in funding or if he was about to take things slow.”

Swann did not immediately respond to messages sent via LinkedIn and Andreessen Horowitz. Gracias did not respond to a request for comment sent to its Valor Equity Partners firm.

Experts said Twitter would be interested in understanding lenders’ concerns about the number of fake accounts on the platform, and whether it was an issue for them as Musk suggested.

Investors were asked for communication about the Twitter deal with people close to Musk, such as Steve Jurvetson, a former Tesla board member and current director of SpaceX, the private rocket company Musk founded and led.

Jurvetson did not immediately respond to a request for comment sent to its Future Ventures firm.

“Lol, lawyers w/ TWTR sending subpoena to friends in the ecosystem surrounding @elonmusk,” wrote Joe Lonsdale, co-founder of Palantir Technologies Inc., on Twitter. He wrote, “I have nothing to do with this other than a few lewd comments, but got the document notice ‘You are here your commanded’.”

He called the Twitter summons a “massive fishing harassment campaign.”

Lonsdale did not immediately respond to a request for comment sent to its 8VC firm.

Delaware corporate litigator Theodore Kittila said Twitter is trying to determine what Musk was saying privately while publicly sending tweets that he was concerned about bots and fake accounts on Twitter.

“They are trying to climb there, behind the tweet,” Kittila said. “They are looking at the emails and trying to divine the conversation that actually took place and that led to their decision to postpone the deal.”

Musk has sent his subpoena over the past two days to data analytics firm Concentricx Solutions Corp and TaskU USA, which moderates content. Musk’s summons questions were filed under seal.

(Except for the title, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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