Before the existing merger, Elon Musk warned Twitter CEO Parag Agarwal to quit ‘creating trouble’
As a result of Twitter’s alleged breach of the contract by refusing to answer questions about phoney or spam accounts on the social media network, Musk cancelled the Twitter agreement earlier this month.
Image Courtesy: Twitter
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Elon Musk, the CEO of Tesla, texted Twitter CEO Parag Agrawal before walking away from the $44 billion acquisition deal to indicate that the company’s lawyers were attempting to “create difficulty.”
Musk texted Twitter CEO Parag Agrawal and CFO Ned Segal on June 28 in response to Twitter’s request for assurances regarding Musk’s funding for the transaction, saying: “Your lawyers are using these conversations to cause trouble. That needs to stop.”
The details were made public in a lawsuit that Twitter filed.
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The lawsuit claimed that Musk had broken “a long list” of merger agreement provisions, which “has put a shadow over Twitter and its business.”
Images of numerous of Musk’s tweets, including one with a poop emoji, were included in it. According to the business, this went against the merger’s “non-disparagement” clause.
In response to two tweets from Agrawal on May 16, Musk posted the emoji, outlining the company’s efforts to combat spam accounts.
Musk claimed that one of the primary reasons he pulled out of the agreement was due to the lack of knowledge regarding spam accounts and false statements, which he believed to be a “material adverse event.”
Additionally, he claimed that executive departures amounted to a failure to conduct business as usual.
Twitter responded by stating that it did not give Musk further information regarding spam accounts because it thought he would create a rival platform after dropping the deal.
Twitter referred to Musk’s justifications as a “pretext” that lacked substance and claimed his choice to go had more to do with the stock market’s collapse, particularly for tech equities.
Additionally, Twitter charged Musk of “secretly” purchasing shares of the business between January and March without properly informing regulators of his significant purchases, and said he “continued accumulating Twitter stock with the market none the wiser.”
One of the most flamboyant businesspeople will be a part of what seems to be one of the largest legal showdowns in Wall Street history thanks to the lawsuit.
Legal professionals have stated that based on the material that is now available, Twitter appears to be in the lead.
“In its complaint, Twitter is taking a strong position that Musk had a case of buyer’s remorse – and that, and not bots, is the reason for his decision to walk away from the deal,” said Brian Quinn, a professor at Boston College Law School. “The facts Twitter presents here make an extremely strong argument in favour of Twitter getting this deal closed.”