Twitter Lawsuit Against Elon Musk Set for Tense First Hearing as Sides Clash Over Trial Timetable
Twitter Lawsuit Against Elon Musk Set for Tense First Hearing as Sides Clash Over Trial Timetable

By Tom Ozimek

Twitter and Elon Musk are set to square off in a Delaware court for the first time on Tuesday in a hearing that will likely see the two sides wrangle over the trial timetable.

The judge overseeing Twitter’s lawsuit against Musk said in a letter that she has tested positive for COVID-19 and that a hearing in the case would proceed virtually on July 19 in Delaware’s Court of Chancery.

Twitter has asked for an expedited trial in September, a motion opposed by Musk’s team, with Judge Kathaleen McCormick set to weigh both sides’ arguments and determine the path of the proceedings going forward.

Twitter filed a lawsuit on July 12 in a bid to force Musk to follow through with his pledge to buy the social media platform for around $44 billion, a premium of over 30 percent above the current market value.

Musk wants to back out of the deal on the premise that Twitter has not provided enough information that would allow for an accurate count of the number of bots, or automated accounts on the platform, impacting the number of monetizable daily active users.

Lawyers acting on behalf of Musk have argued that the number of bots on Twitter is far greater than the 5 percent that the company has disclosed, representing a “material adverse effect” that justifies his backing out of the deal.

A Twitter representative told The Epoch Times that the company would not comment on pending litigation.

‘Warp Speed’ Trial

Twitter’s lawyers have requested an expedited trial in the case against Musk, arguing that the non-jury trial should start on Sept. 19 because the buyout agreement Musk signed with the company’s board expires on Oct. 24.

They’ve also said they only need four days to prove Musk should be forced to go through with the deal.

In its 62-page complaint (pdf), Twitter alleges that Musk’s actions have hurt its business and stock price.

“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,” Twitter said in the complaint.

“Since signing the merger agreement, Musk has repeatedly disparaged Twitter and the deal, creating business risk for Twitter and downward pressure on its share price.”

Elon Musk’s Twitter page displayed on the screen of a smartphone with Twitter logo in the background in Los Angeles on July 8, 2022. (Chris Delmas/AFP via Getty Images)

Musk Fires Back

The Tesla chief has fired back at Twitter’s request to fast-track the court proceedings.

His legal team alleged in a July 15 filing (pdf) that Twitter is engaged in an “unjustifiable request to rush” the trial.

“Twitter’s sudden request for warp speed after two months of foot-dragging and obfuscation is its latest tactic to shroud the truth about spam accounts long enough to railroad Defendants into closing,” Musk’s lawyers wrote in the filing.

Musk’s lawyers said that the question of bots or automated accounts on Twitter is “fundamental” to the case and that more time is needed for discovery.

While Musk’s team wants the trial postponed to February at the earliest, Twitter has based its request for a speedier trial on the fact that the buyout agreement Musk signed with the company’s board expires at the end of October.

But Musk’s lawyers reject that reasoning, arguing in their filing that Twitter’s bid for “extreme expedition rests on the false premise” that the termination date is Oct. 24, “glossing over that this date is automatically stayed if either party files litigation.”

They said that, by filing its complaint, Twitter “has rendered its supposed need for a September trial moot.”

Twitter has pushed back on Musk’s request for a trial held in February, claiming the billionaire’s request “fails at every level.”

“Musk offers no reason to think discovery must be so expansive that a trial must wait until next year,” Twitter’s attorneys stated in a July 18 filing.

“The earliest possible trial date is imperative. This very public dispute harms Twitter with each passing day Musk is in breach,” they said.

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