The social media site wants to force Musk to follow through on his offer to buy the company for $44 billion.
In a recent filing, Elon Musk’s lawyers say that Twitter lied about the company and its “key metrics” and changed the value of the company to try to get the billionaire to agree to buy the social media platform for a higher price.
In a countersuit that was made public Thursday, the details of the claims were given. The filing accuses Twitter of fraud and says that the statements it made to the Securities and Exchange Commission were “far from true” and “contain a number of material misrepresentations or omissions that distort the value of Twitter.”
Twitter said in its reply that its SEC filings are correct and that the company “did not lie about anything.”
Twitter said that the claim that Musk was “duped” into signing the merger is “as unlikely and untrue as it sounds.” It also said that Musk is making excuses to get out of the deal.
Last month, Twitter sued Musk because he tried to back out of an agreement to buy Twitter for $54.20 per share, or $44 billion, and take it private. Since April, when Musk first offered to buy Twitter, the social media site’s share price has dropped to $41. This has led some people, including Twitter, to think that Musk is just trying to get a lower price for the company.
Musk, on the other hand, says Twitter is hiding information about how many fake and spam accounts are on its site. He says the company is lying to investors about how many active users it really has. A lot of the countersuit is about these accounts and the number of active users.
Twitter has said in the past that it gave Musk all the information he asked for when he made these claims.
Now, Twitter is taking Musk to court to make him keep his promise to sell the company.
In the last four months, Musk’s bid for the company has taken many turns and twists like this one.
All of this started in April, when Musk became Twitter’s largest public shareholder by saying he owned more than 9% of the company’s stock.
At first, Musk was going to use his stake to get a seat on Twitter’s board of directors. This changed at some point, and he put together a bid to buy Twitter outright.
“I invested in Twitter because I think it has the potential to be the platform for free speech around the world,” Musk wrote in a letter to Twitter’s board chair Bret Taylor on April 14. “I think that free speech is a social must for a democracy to work.”
Twitter’s first response to the bid was to add a “poison pill” clause, which would have given out more shares of the company to lower the value of Musk’s stake.
But by the end of that month, Musk had made his 11-figure offer to buy Twitter, and the social media company changed its mind, deciding that Musk’s $44 billion valuation of the company was the best price its shareholders would get. On April 25, they said yes to Musk’s offer.
Musk said in May that he was putting the deal on hold because there were too many fake and spam accounts on the site, which he said was a problem. Twitter had said for a long time in official filings that it thought no more than 5% of the accounts on its site fit that description. This makes people wonder what Musk’s real reasons are for what seems to be a backpedal.
Between when Musk offered $54.20 per share and when he said he was putting the deal on hold, Twitter’s share price dropped as low as $45.
No matter what happened, Musk and Twitter could not agree on a way to end the fight, which led to the current standoff. Now, lawyers for both Twitter and Musk have a trial date set for October in Delaware Chancery Court, which is the main court in the United States for settling business disputes.