Micro-blogging social media platform; Twitter Inc. on Tuesday, July 12th, 2022 sued billionaire and founder of Telsa Mr. Elon Musk for breaching the USD$44 billion (approx. UGX166.7 trillion) contract he signed to buy the social media platform.
According to the legal documents, the company wants a Delaware court to order Musk to complete his $44bn takeover deal of Twitter Inc., asserting that no financial penalty could repair the damage Musk has caused.
“Musk’s conduct simply confirms that he wants to escape the binding contract he freely signed, and to damage Twitter in the process,” the court documents read. “Twitter has suffered and will continue to suffer irreparable harm as a result of defendants’ breaches.”
Musk tried to back out of the acquisition in a letter to Twitter’s top lawyer on Friday, citing Twitter’s number of fake accounts and claiming that the tech firm failed to give him enough information about the issue plus misrepresented itself.
He also accused Twitter of breaking the acquisition agreement when it fired two executives and laid off a third of its talent-acquisition team. Twitter chairman Bret Taylor tweeted that the company intends “to hold Elon Musk accountable to his contractual obligations”.
Twitter has filed a lawsuit in the Delaware Court of Chancery to hold Elon Musk accountable to his contractual obligations.
— Bret Taylor (@btaylor) July 12, 2022
Musk also took to Twitter and tweeted: “Oh the irony lol.”
Oh the irony lol
— Elon Musk (@elonmusk) July 12, 2022
The 62-page lawsuit said that after Musk agreed to the deal, the stock market fell, along with Musk’s stake in Tesla.
“The value of Musk’s stake in Tesla, the anchor of his personal wealth, has declined by more than USD$100 billion from its November 2021 peak. So Musk wants out,” the lawsuit read in part. Adding “Rather than bear the cost of the market downturn, as the merger agreement requires, [Mr] Musk wants to shift it to Twitter’s stockholders.”
The suit further says that Musk’s exit strategy is a model of hypocrisy and bad faith.
“While pretending to exercise the narrow right he has under the merger agreement to information for “consummation of the transaction,” Musk has been working furiously — albeit fruitlessly — to try to show that the company he promised to buy and not disparage has made material misrepresentations about its business to regulators and investors.”
“He has also asserted, falsely, that consummation of the merger depends on the results of his fishing expedition and his ability to secure debt financing.” said the suit.