In an escalating legal battle, Elon Musk filed a countersuit against social media giant Twitter on Saturday, 30 July, over his attempt to walk away from his proposed $44 Billion purchase of the company. The 164-page lawsuit was filed confidentially and is not publicly available.
The lawsuit was filed a few hours after Delaware Court of Chancery Chancellor Kathleen McCormick ordered a five-day trial starting 17 October to determine if the Tesla CEO can walk away from the multi-billion dollar deal.
Musk, who indicated he was acquiring Twitter to ensure free speech and rid the platform of bots and fake accounts, decided to back out of the deal on 10 July, accusing the company of lying about how many bots were on its platform.
Calling Musk’s fake account claim a distraction, Twitter filed a lawsuit a few days later, saying that Musk was bound by the merger contract to close the deal at $54.20 per share.
Musk's proposed merger agreement, which he referred to as “seller-friendly," didn't leave him with many options to back out of the deal, Twitter's lawsuit suggested.
Twitter’s shares, however, ended at $41.61 on Friday, the highest close since Musk’s abandonment of the deal.
The micro-blogging site has blamed the court battle for its slumping revenue and chaos being caused within the company.
Chancellor McCormick, fast-tracking the case to trial, said that she aimed to limit the potential harm faced by Twitter due to the uncertain nature of the deal.
On Friday, Musk was also sued by a Twitter shareholder who requested the court to direct the billionaire to complete the deal, determine Musk’s breach of his fiduciary duty to Twitter shareholders and award damages for the losses caused by Musk.
(At The Quint, we question everything. Play an active role in shaping our journalism by becoming a member today.)