Finance

Elon Musk countersues Twitter

Published

2 years ago

July 31, 2022

Elon Musk has filed a private countersuit against Twitter, intensifying his legal battle with the social media firm over his attempt to back out of the $44 billion acquisition..

His case was submitted on Friday, just hours after Delaware Court of Chancery Chancellor Kathaleen McCormick ordered a five-day trial to decide whether Musk can back out of the agreement.

Although the 164-page document was not publicly available, a redacted version would soon be made public per court rules.

Also on Friday, a Twitter shareholder, Luigi Crispo, filed a lawsuit against Musk, asking the court to compel Musk to finalize the transaction.

According to him, the billionaire violated his fiduciary obligation to Twitter shareholders, and grant damages for the losses he caused..

Since he owns 9.6% of Twitter and has veto power over many of the company’s actions thanks to the takeover deal, the lawsuit, which is seeking class status, contends that Musk has a fiduciary duty to the company’s shareholders.

Earlier in July, the Tesla CEO had announced that he was giving up on the acquisition. He accused Twitter of breaking the deal by exaggerating the number of false accounts on its platform.

Days later, Twitter filed a lawsuit, claiming that Musk was required by the merger agreement to close the deal at $54.20 per share and that the false account claims were a diversion.

The company’s shares closed at $41.61 on Friday, the highest close since Musk backed out of the agreement.