Elon Musk is reportedly filing his own countersuit against Twitter to try and get out of his $44billion deal to buy the social media giant.
Musk’s legal team wants the Delaware Court of Chancery grant them extra time and ability to put together a case regarding fake accounts and ‘bots’ on Twitter, according to the New York Post.
This comes after Twitter on Monday accused Musk of trying to ‘slow walk’ the company’s lawsuit to hold him to his takeover and urged a September trial to ensure deal financing remains in place, according to a court filing.
‘Millions of Twitter shares trade daily under a cloud of Musk-created doubt,’ the company wrote. ‘No public company of this size and scale has ever had to bear these uncertainties.’
Twitter has sued Musk and asked a Delaware judge to order him to complete the merger at the agreed price of $54.20 per share.
The company said if Musk is ordered to close the deal it could still take months of additional litigation to close the debt financing, which expires in April. For that reason, Twitter asked the judge to reject Musk’s proposal to hold the trial in February.
Musk, who is the world’s richest person and chief executive of electric carmaker Telsa Inc, accused San Francisco-based Twitter of rushing the trial to obscure the truth about spam accounts and to “railroad” him into buying the company.
The first hearing in Twitter’s original lawsuit will take place Tuesday in front of Delaware Court of Chancery Chancellor Kathaleen McCormick.
McCormick will likely rule on Twitter’s request for an expedited trial.
According to the Post, Twitter’s lawyers want the trial to start in September, while Musk’s team wants it to begin no earlier than February 2023.Musk’s countersuit will also be heard by Chancellor McCormick.
On July 8, Musk said he was terminating the deal because Twitter violated the agreement by failing to respond to requests for information regarding fake or spam accounts on the platform, which is fundamental to its business performance.
The billionaire appeared to respond to the suit in a tweet on Tuesday evening, writing: ‘Oh the irony lol.’
Twitter’s lawsuit argues: ‘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’s General Counsel Sean Edgett informed staff of the lawsuit in a company-wide memo on Tuesday afternoon.
‘We have also filed a motion for an expedited trial alongside the complaint, asking for the case to be heard in September, as it is critically important for this matter to be resolved quickly,’ Edgett wrote in the memo, according to the New York Times.
‘At this point, we anticipate the next step in the process will be for the court to set a schedule for the case,’ he added.
The lawsuit was a widely anticipated step after Musk last week announced his intent to pull out of the April 25 merger agreement, which specified penalties for backing out of the deal.
Those penalties included a $1 billion breakup fee, as well as the ability for the parties to enforce the contract in court, which Twitter officials had previously vowed to do.
Musk argues that Twitter has broken its contractual obligations by failing to disclose key information about fake accounts on the platform.