Social media platform, Twitter’s lawsuit to hold Elon Musk over his $44 billion acquisition of the microblogging site, is set to go to trial in October after a Delaware judge yesterday said the social media company is seeking a quick solution to the uncertainty. earned from the deal.
The ruling is a blow to Musk, who pushed for a trial in February, which his attorney said the court would allow a comprehensive investigation into the true number of spam accounts on the platform. Twitter had requested a September trial.
Chancellor Kathaleen McCormick of the Court of Chancery in Delaware said the parties were able to handle an expedited trial.
“The reality is that delay threatens irreparable harm to the sellers,” she said, referring to Twitter. She asked the parties to work out the timetable for the trial, which she set at five days.
According to Reuters, Twitter shares rose throughout yesterday morning and rose 3.6 percent to $39.81 in the early afternoon.
Twitter wants McCormick to declare that Musk has violated the merger agreement and instruct him to complete the merger at the agreed price of $54.20 per share. It said it needed the earliest possible trial date in case Musk was ordered to close and then additional lawsuits were needed to address the funding.
Twitter’s attorney William Savitt argued at the hearing that the number of the bot and spam accounts on his service had no bearing on the deal with Musk. He said Musk took the issue because he wanted “to conjure an exit for a deal that has none”.
Musk had argued that an accelerated process would prevent the truth about spam from coming out.
A Musk lawyer yesterday accused Twitter of dragging on responding to Musk’s requests for information about methods for calculating the number of spam accounts.
“When Mr. Musk started asking questions, the answers he got were alarming,” said Andrew Rossman, Musk’s attorney. He said it will take months to analyze massive amounts of data to resolve Musk’s questions about Twitter’s spam accounts.
Rossman also pushed back on the idea that Musk was trying to harm Twitter, pointing out that the billionaire had a greater interest than the combined interests of Twitter’s directors.
According to the report, even with this scheduling dispute, the stakes were high for Twitter. The company struggled to grow its user base and advertising business before Musk got involved, and now the company and many other tech companies are cutting costs amid rampant inflation and fears of a recession.
Twitter needs a quick solution to its battle with Musk to mitigate uncertainty for its shareholders, employees, and customers, and any consequences for his company that could be exacerbated by costly, lengthy lawsuits.
While yesterday’s hearing was largely a procedural one, it offered a look at how both sides can approach what will likely be a messy litigation process. It can also give a glimpse of how the judge overseeing the case approaches the dispute.
“There may be hints of what she’s asking and what she’s saying, and what they’re saying, during the hearing that might tell us something,” said Carl Tobias, a professor at the University of Richmond School of Law.