Tesla CEO Elon Musk announced on Friday he was backing out of a deal to buy Twitter for $44 billion, accusing the social media giant of failing to make good on a promise to give him access to information about spam accounts.
According to the New York Post, Musk’s legal team said in an FEC filing that Twitter had refused to reply to multiple requests from Musk for information on spam accounts. The number of accounts is crucial to the company’s net value.
The filing alleged that “Twitter is in material breach of multiple provisions of the buyout deal.”
“[Twitter] appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement,” it added.
In a letter address to Twitter, Musk’s lawyers Skadden Arps said: “For nearly two months, Mr. Musk has sought the data and information necessary to make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform.”
Twitter has failed or refused to provide this information. Sometimes Twitter has ignored Mr. Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr. Musk incomplete or unusable information.”
Twitter chairman Bret Taylor responded by warning Musk they could take challenge him in court for terminating the deal.
“The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement,” Taylor said on Twitter on Friday afternoon. “We are confident we will prevail in the Delaware Court of Chancery.”
In the filing, Musk admitted that Twitter did provide some information about fake users but alleged that it was not even the amount it gave large advertisers.
“While Twitter has provided some information, that information has come with strings attached, use limitations or other artificial formatting features, which has rendered some of the information minimally useful to Mr. Musk and his advisors.”
Musk also hit back at Twitter’s recently announced layoffs, saying that the move needed to be approved by him before going forward.
(Israel National News' North American desk is keeping you updated until the start of Shabbat in New York. The time posted automatically on all Israel National News articles, however, is Israeli time.)