First blow to Elon Musk, Twitter fast-tracks October trial

First blow to Elon Musk, Twitter fast-tracks October trial

Twitter gets Elon Musk fast-track trial in $44 billion deal

Twitter Inc. will get an October trial in a legal battle over its $44 billion acquisition of Elon Musk, a Delaware judge said on Tuesday, adding that the social media company deserves a quick resolution to the uncertainty of the deal.

The ruling comes as a blow to Musk, who in February pushed for a trial to allow a wider investigation into his claims that Twitter misrepresented the number of fake or spam accounts.

The question of whether Twitter’s user numbers have been increased is at the core of his argument that he may walk away from the deal. The company, which requested the September test, says the issue is a distraction and that the terms of the deal will require Musk to pay.

Twitter had argued that delaying the trial to next year could threaten the financing of the deal.

After the widely followed Johnny Depp vs Amber Heard case, Twitter-Musk is now in the spotlight on lawyers in the trial.

Kathleen McCormick, Chancellor of the Court of Chancery in Delaware, said Tuesday that the company deserves an expedited decision on its claims.

β€œThe reality is that delays risk irreparable harm to sellers,” she said, referring to Twitter.

McCormick asked the parties to draw up a schedule for the trial, which he said would last five days.

Twitter shares were up 3.4% at $39.71 on Tuesday afternoon.

An attorney for Musk, who is also the chief executive of electric car maker Tesla Inc., did not respond to a request for comment.

“We are pleased that the court has agreed to expedite this trial,” a Twitter spokesperson said.

Twitter wants McCormick to order Musk to complete the deal at an agreed price of $54.20 per share. It said it needed the earliest possible trial date if Musk was ordered to shut down and needed additional litigation to address the financing that expires in April.

Twitter attorney William Savitt argued during the hearing that Musk held onto the issue of bots and spam accounts because he wanted to “accept an exit ramp for a deal that doesn’t have one.”

Musk’s lawyer emphasized the notion that Musk was trying to harm Twitter, pointing out that the billionaire has a larger stake than the combined holdings of Twitter’s directors.

Musk had argued that a speedy test would allow Twitter to hide the truth about spam accounts, which Musk began questioning after signing a deal for Twitter in late April.

Musk’s lawyer, Andrew Rossman, said: “When Mr. Musk began asking questions, the answers he received were shocking.” He said it would take months to analyze the massive amount of data to resolve Musk’s questions about Twitter’s spam accounts.

Musk already faces a separate five-day trial before McCormick, starting October 24, over his record $56 billion salary package from Tesla.


Indian Lekhak

Leave a Reply

Your email address will not be published.