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Home»Tech News»Elon Musk says whistleblower’s testimony gives him more reasons to dump Twitter deal
Tech News

Elon Musk says whistleblower’s testimony gives him more reasons to dump Twitter deal

August 30, 2022No Comments2 Mins Read
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Elon Musk’s lawyers try to slow down the progress of Twitter’s lawsuit
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Elon Musk says the disclosures of Twitter’s former security chief have given him new justifications to walk away from his $44 billion deal to buy the social media platform.

Musk’s lawyers filed a new “Termination Letter” with the SEC on August 29th, which cites the testimony of Twitter whistleblower Peiter “Mudge” Zatko as evidence that Twitter misled Musk in the parties’ merger agreement. Specifically, Musk claims that Twitter’s declaration in the merger agreement that it had not misled the SEC is false, citing Zatko’s allegations. In Zatko’s own complaints, which were published last week, he claimed that Twitter repeatedly and knowingly misled regulators about the security of its platform.

“[Zatko’s] allegations, if true, demonstrate that Twitter has breached the following provisions of the Merger Agreement, thereby giving the Musk Parties the right to terminate the Merger Agreement pursuant to its terms as more fully described below,” states Musk’s new termination letter.

Musk, of course, is desperate to back out of the deal, but needs to prove to a judge that Twitter violated some aspect of the merger agreement. If he doesn’t, he’ll have to pay a $1 billion fine or be forced to carry out “specific performance” (meaning: actually buy Twitter).

It’s not clear, though, if Musk’s new termination letter strengthens his case. Musk’s first termination letter was filed in the beginning of July, and made similar accusations that Twitter misled the SEC in its regulatory disclosures (among other claims). This new letter essentially repeats the same charge, adding Zatko’s complaint as additional evidence.

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Law professor Ann Lipton, who’s analyzed the credibility of Musk’s legal case for walking away from the Twitter deal, previously said Zatko’s complaint would be something of a “wild card” in the legal case. However, prior to the appearance of this new termination letter, she said Musk’s arguments “do not appear to be very strong.”

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