Elon Musk invoked in a new letter to Twitter the accusations made by the company’s former security chief, Peiter Zatko, to justify with additional arguments the abandonment of his takeover plan initially announced in early July. “Allegations relating to certain facts, known to Twitter before or on July 8, 2022, but not disclosed to parties representing Musk before or on that date, have since surfaced and provide additional and distinct reasons for terminating the agreement of takeover,” wrote Mike Ringler, one of Elon Musk’s attorneys, in a letter to Twitter’s chief legal officer dated Monday and made public Tuesday.
Mike Ringler talks about allegations made by Peiter “Mudge” Zatko, ex-Twitter security chief, who attacked the platform’s failing cybersecurity and accused executives of lying about the means put in place implemented to fight against fake accounts and spam. The claims of Peiter Zatko, who presents himself as a whistleblower, were sent to two American regulators as well as to the Department of Justice.
The lawyer for the boss of Tesla specifies that these new elements are, according to him, not necessary to justify the breach of the contract, but constitute additional arguments “in the event that the notice of breach of July 8 was deemed invalid, whatever ‘be the reason’.
Twitter reacted to Mike Ringler’s letter, deeming the reason given “invalid and unjustified”. “It is based solely on statements made by a third party which, as Twitter has previously claimed, are riddled with inconsistencies and inaccuracies and obscure important context,” wrote William Savitt, one of the attorneys for the company. The social network, which denies any violation of the terms of the agreement reached with Elon Musk, intends to complete the acquisition at the agreed price of 54.20 dollars per share, or approximately 44 billion dollars.
A trial expected on October 17
Elon Musk has also filed a document with the policeman of the American Stock Exchange, the SEC, to warn him of additional reasons justifying the abandonment of the acquisition.
At the beginning of July, Elon Musk announced that he was breaking the takeover agreement with Twitter’s board of directors, accusing the company of not having respected its commitments by not communicating the exact number of inauthentic accounts and spam. This decision had led Twitter to sue the billionaire entrepreneur to force him to honor the terms of the agreement. A trial, which is expected to last five days, will begin on October 17 in a specialized court in Delaware.
Elon Musk’s legal team has asked Peiter Zatko to provide documents and testify in these proceedings, a request accepted by the former Twitter official’s lawyers. According to Dan Ives of Wedbush Securities, Peiter Zatko’s charges, weeks away from trial, are potentially “a huge win for Musk that could make Twitter’s case more complicated.” For the analyst, this development is likely to push the two parties to negotiate and find a compromise before October 17, which could take the form of a takeover of Twitter by Elon Musk at a renegotiated downward price.