Compensation for whistleblowers
Musk gives new reason for cancellation of purchase on Twitter
09/10/2022, 11:50 am
Elon Musk is positioning himself further in the legal dispute with Twitter. Twitter management is said to have paid its fired security chief $7 million without notifying him. Musk’s lawyers suspect breach of contract.
Tesla boss Elon Musk sees a million-dollar compensation from Twitter for a fired whistleblower as further justification for canceling the takeover. That emerges from a letter from Musk’s lawyers on Friday. Twitter failed to get Musk’s approval before paying $7 million to his former security chief Peiter Zatko and $750,000 to his lawyers. In doing so, Twitter violated the takeover agreement, which restricts such payments. Musk is therefore not obliged to complete the acquisition. No comment was initially available from Twitter.
In January, Zatko, who made a name for himself as a hacker as “Mudge,” was fired from Twitter. According to Musk’s lawyers, his severance pay was paid as part of an agreement between Twitter and Zatko in late June.
Musk announced in April that he wanted to acquire Twitter for $44 billion. In July, referring to alleged false statements by Twitter about the number of bogus accounts on the platform, he then declared that he would not complete the purchase.
In August, Zatko stated in a complaint that Twitter falsely stated that it had a good security plan. Musk cites this as another reason not to make the purchase.
Musk and Twitter have sued each other. Twitter wants a Delaware court to order the billionaire to close the deal at $54.20 per share. Musk is seeking an injunction to call off the purchase and not have to pay the $1 billion penalty agreed in this case. The trial is scheduled to begin on October 17.