It’s official.
Twitter has filed a suit in Delaware Chancery Court that seeks to enforce the sale of the company to Elon Musk.
Musk had earlier agreed to a $44 billion deal to buy Twitter but on Friday, walked away, claiming the company had not supplied him with needed information. Musk had previously lined up financing to take the social media company private.
Twitter feels otherwise and used harsh language to describe his actions.
“Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away. This repudiation follows a long list of material contractual breaches by Musk that have cast a pall over Twitter and its business,” the lawsuit states. “Twitter brings this action to enjoin Musk from further breaches, to compel Musk to fulfill his legal obligations, and to compel consummation of the merger upon satisfaction of the few outstanding conditions.”
The filing included tweets from Musk, one of Twitter’s most active users.
The suit also claimed “Musk’s exit strategy is a model of hypocrisy. One of the chief reasons Musk cited on March 31, 2022 for wanting to buy Twitter was to rid it of the “rypto spam” he viewed as a “major blight on the user experience.” Musk said he needed to take the company private because, according to him, purging spam would otherwise be commercially impractical. In his press release announcing the deal on April 25, 2022, Musk raised a clarion call to “defeat[] the spam bots.” But when the market declined and the fixed-price deal became less attractive, Musk shifted his narrative, suddenly demanding “verification” that spam was not a serious problem on Twitter’s platform, and claiming a burning need to conduct “diligence’ he had expressly forsworn.”
Twitter publicly announced on Friday its plans to file suit in Chancery, the nation’s leading business court.
Given Musk’s vast financial resources and other factors, the outcome of the suit remains unclear, with outcomes ranging from dismissal to Musk paying a break-up fee or being compelled to the company.
See a copy of the suit below.
