Twitter rejected Elon Musk’s claims in a US court that he was tricked into signing a deal to buy the social media company were “implausible and untrue”.
Musk made the claims in a countersuit filed under seal last Friday that was made public Thursday.
“According to Musk, he — a billionaire founder of several companies who was advised by Wall Street bankers and lawyers — was tricked by Twitter into signing a $44 billion merger agreement. This story is as implausible and untrue as it sounds,” Twitter said in a statement on Thursday.
Twitter’s filing is the latest salvo in what is shaping up to be an increasingly bitter legal battle between the world’s richest man and the social media giant.
The two sides will head to court on Oct. 17 after Musk tried to back out of a deal to buy Twitter over what he called misrepresentations by fake accounts on the site. The San Francisco-based company is trying to force Musk to go through with the deal and accuses him of sabotaging it because it no longer serves his interests.
A spokesman for Musk did not immediately respond to a request for comment.
In counterclaims filed Thursday, Musk accuses Twitter of stepping up efforts to hide the true number of its users as the market plummeted.
“As the prolonged bull market was coming to an end and the tide was going out, Twitter knew that providing the Musk parties with the information they requested would reveal that Twitter was swimming naked,” the counterclaim said. Twitter denies that Musk has not “provided any evidence” of these “baseless factual” allegations.
Musk also claims that “Twitter’s misrepresentations run much deeper than just providing incorrect numbers” about spam or fake accounts. While “Twitter advertises 238 million ‘monetized daily active users,’ those users who actually see ads,” that’s about 65 million fewer, Musk says in the counterclaim.
Twitter maintains that its regulatory disclosures regarding monetized daily active users were accurate.
Musk, the chief executive of electric car maker Tesla, offered to buy Twitter for $54.20 a share in April, saying he believed in its potential as a global platform for free speech. But he soured on Twitter as its stock price lagged behind his takeover bid and began expressing skepticism that bot and spam accounts made up less than 5% of users.
Musk tried to back out on July 8 without paying $1 billion to settle the breach, citing Twitter’s failure to provide details about bot and spam accounts. Four days later, Twitter sued him.
Earlier this week, Twitter issued dozens of subpoenas to banks, investors and law firms that backed Musk’s takeover bid, and Musk subpoenaed Twitter’s advisers at Goldman Sachs and JP Morgan over their work.
Legal experts said Twitter’s requests indicated the company wanted to know why Musk had turned against it, whether he had failed to fulfill his obligations to obtain sufficient funding. — Noeline Walder and Tom Hulse with Anirban Sen and Greg Roumeliotis, (c) 2022 Reuters