According to a court document filed on Thursday, billionaire Elon Musk claimed Twitter committed fraud by hiding severe weaknesses in the social media giant’s data security, which the businessman said should have allowed him to terminate his $44 billion agreement with the company.
Musk, the wealthiest man in the world, updated his earlier complaint by including claims made by a Twitter whistleblower, who on Tuesday informed Congress of foreign operatives’ interference on the significant social media network.
Tesla’s CEO also said that Twitter concealed from him the fact that it was not abiding by a 2011 deal with the Federal Trade Commission over user data. The revised countersuit said that “it goes without saying that the latest facts make clearly evident that the Musk Parties have the complete right to walk away from the Merger Agreement — for several independently adequate grounds.”
Peiter “Mudge” Zatko, a former head of Twitter security, made the allegations, and according to Musk, they amount to fraud and a violation of Twitter’s contract.
While Twitter wants the court to force Musk to acquire the firm for $54.20 per share, Musk has requested a Delaware judge to rule that he was not required to complete the transaction. On October 17, a five-day trial is set to start.
Late Thursday trading saw a 0.6% increase in Twitter shares. According to Twitter, it looked into Zatko’s claims internally and found them to be unfounded. According to the business, Zatko was let go for subpar work.
The whistleblower accusations that Musk included in his argument, according to Twitter’s legal team, were either insufficient to terminate the contract or did not fulfill the criteria for fraud, according to the attorneys representing Twitter.
Source: Reuters and NBC News