Twitter-Musk takeover dispute heading for an October trial

look for twitter, this is *** nightmare scenario and now the stock is going to be under pressure with the must deal done because this is gonna be *** clear headwinds going forward, employee turnover, advertiser issues and really credibility. I think it's gonna be viewed at least in the near term damaged goods. From *** public market perspective airing dirty laundry in public, in the courts, in Delaware, I mean that's really gonna be, I think for all the world to see now, if it's 5% or less, which Twitter has claimed, then ultimately they're proven right must likely has to pay some punitive damages including the breakup, faith and Twitter really ultimately wins in that situation. Problem is is that if this starts to ultimately cascade and the twitter body issue is much bigger and that comes out in court. I think that really calls into question *** lot of issues about the business model, modernization and others and that's why from *** twitter board perspective backs against the wall and the last thing they ever wanted to be was in *** court proceeding with the richest person in the world, Twitter legally could force *** sale to go through. I think if you could historically likely it's in some sort of settlement, but but no doubt, I mean, twitter is gonna sharpen the knives going in

Tesla CEO Elon Musk lost his fight to delay Twitter’s lawsuit against him as a Delaware judge on Tuesday set an October trial, citing the “cloud of uncertainty” over the social media company after the billionaire backed out of a deal to buy it.“Delay threatens irreparable harm,” said Chancellor Kathaleen St. Jude McCormick, the head judge of Delaware’s Court of Chancery, which handles many high-profile business disputes. “The longer the delay, the greater the risk.”Twitter had asked for an expedited trial in September, while Musk’s team called for waiting until early next year because of the complexity of the case. McCormick said Musk’s team underestimated the Delaware court’s ability to “quickly process complex litigation.”Twitter is trying to force the billionaire to make good on his April promise to buy the social media giant for $44 billion — and the company wants it to happen quickly because it says the ongoing dispute is harming its business.Musk, the world’s richest man, pledged to pay $54.20 a share for Twitter, but informed the company in July that he wants to back out of the agreement.“It’s attempted sabotage. He’s doing his best to run Twitter down,” said attorney William Savitt, representing Twitter before McCormick on Tuesday. The hearing was held virtually after McCormick said she tested positive for COVID-19.Musk has claimed the company has failed to provide adequate information about the number of fake, or “spam bot,” Twitter accounts, and that it has breached its obligations under the deal by firing top managers and laying off a significant number of employees. Musk's team expects more information about the bot numbers to be revealed in the trial court discovery process, when both sides must hand over evidence.Twitter argues that Musk’s reasons for backing out are just a cover for buyer's remorse after agreeing to pay 38% above Twitter’s stock price shortly before the stock market stumbled and shares of the electric-car maker Tesla, where most of Musk’s personal wealth resides, lost more than $100 billion of their value.Savitt said the contested merger agreement and Musk’s tweets disparaging the company were inflicting harm on the business and questioned Musk’s request for a delayed trial, asking “whether the real plan is to run out the clock.”“He’s banking on wriggling out of the deal he signed,” Savitt said.But the idea the Tesla CEO is trying to damage Twitter is “preposterous. He has no interest in damaging the company,” said Musk attorney Andrew Rossman, noting he is Twitter’s second largest shareholder with a “far larger stake” than the company's entire board of directors.Savitt emphasized the importance of an expedited trial starting in September for Twitter to be able to make important business decisions affecting everything from employee retention to relationships with suppliers and customers.Rossman said more time is needed because it is “one of the largest take-private deals in history” involving a “company that has a massive amount of data that has to be analyzed. Billions of actions on their platform have to be analyzed.”

“Delay threatens irreparable harm,” said Chancellor Kathaleen St. Jude McCormick, the head judge of Delaware’s Court of Chancery, which handles many high-profile business disputes. “The longer the delay, the greater the risk.”

Twitter had asked for an expedited trial in September, while Musk’s team called for waiting until early next year because of the complexity of the case. McCormick said Musk’s team underestimated the Delaware court’s ability to “quickly process complex litigation.”

Twitter is trying to force the billionaire to make good on his April promise to buy the social media giant for $44 billion — and the company wants it to happen quickly because it says the ongoing dispute is harming its business.

Musk, the world’s richest man, pledged to pay $54.20 a share for Twitter, but informed the company in July that he wants to back out of the agreement.

“It’s attempted sabotage. He’s doing his best to run Twitter down,” said attorney William Savitt, representing Twitter before McCormick on Tuesday. The hearing was held virtually after McCormick said she tested positive for COVID-19.

Musk has claimed the company has failed to provide adequate information about the number of fake, or “spam bot,” Twitter accounts, and that it has breached its obligations under the deal by firing top managers and laying off a significant number of employees. Musk's team expects more information about the bot numbers to be revealed in the trial court discovery process, when both sides must hand over evidence.

Twitter argues that Musk’s reasons for backing out are just a cover for buyer's remorse after agreeing to pay 38% above Twitter’s stock price shortly before the stock market stumbled and shares of the electric-car maker Tesla, where most of Musk’s personal wealth resides, lost more than $100 billion of their value.

Savitt said the contested merger agreement and Musk’s tweets disparaging the company were inflicting harm on the business and questioned Musk’s request for a delayed trial, asking “whether the real plan is to run out the clock.”

“He’s banking on wriggling out of the deal he signed,” Savitt said.

But the idea the Tesla CEO is trying to damage Twitter is “preposterous. He has no interest in damaging the company,” said Musk attorney Andrew Rossman, noting he is Twitter’s second largest shareholder with a “far larger stake” than the company's entire board of directors.

Savitt emphasized the importance of an expedited trial starting in September for Twitter to be able to make important business decisions affecting everything from employee retention to relationships with suppliers and customers.

Rossman said more time is needed because it is “one of the largest take-private deals in history” involving a “company that has a massive amount of data that has to be analyzed. Billions of actions on their platform have to be analyzed.”

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