Litigation Begins: Twitter Files Suit Against Musk

Litigation Begins: Twitter Files Suit Against Musk

Twitter filed suit on Tuesday against Elon Musk over the CEO of Testa’s attempt to walk away from his $44 billion takeover bid. The suit is seeking to force him to honor the terms of the deal.

“The suit, filed in Delaware Chancery Court on Tuesday, comes days after Musk moved to terminate the acquisition, saying the company hadn’t provided the necessary data and information he needed to assess the prevalence of fake or spam accounts and was ‘in material breach of multiple provisions’ of the merger agreement,” according to the WSJ.

“Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he—unlike every other party subject to Delaware contract law—is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away,” Twitter said in the complaint.

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“Musk refuses to honor his obligations to Twitter and its stockholders because the deal he signed no longer serves his personal interests,” the company said in the suit. “Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away.”

Twitter said Musk had a change of heart as soon as market conditions soured, resulting in his personal wealth declining by more than $100 billion from its November 2021 peak. “Rather than bear the cost of the market downturn, as the merger agreement requires, Musk wants to shift it to Twitter’s stockholders,” the company claims.