DOVER, Del. – A Delaware judge is hearing arguments over the sharing of information by lawyers for Twitter and Elon Musk in a lawsuit in which the social media giant is seeking to force Musk to proceed with its $44 billion acquisition of Twitter.
Tuesday’s hearing comes three weeks before a scheduled trial in the lawsuit.
Musk, the world’s richest man, agreed in April to buy Twitter and take it private, offering $54.20 a share and pledging to loosen the company’s control over content and root out fake accounts. In July, Musk indicated he wanted to back out of the deal, claiming Twitter had failed to provide him with enough information about the number of fake accounts on its platform.
The hearing will begin with arguments on a motion by Musk’s lawyers to review their response to the lawsuit and their counterclaims against Twitter for a second time. Musk’s lawyers want to add information about a severance agreement and a $7.75 million payment to former employee Peiter “Mudge” Zatko. Musk’s lawyers claim that Twitter needed his consent before making the payment, but did not.
Zatko is a cybersecurity expert who was head of security for Twitter until he was fired earlier this year. He filed a whistleblower complaint in July with Congress, the Justice Department, the Federal Trade Commission and the Securities and Exchange Commission. The complaint outlines a number of allegations against Twitter, including that CEO Parag Agrawal and other senior executives and board members made false and misleading statements about Twitter’s cybersecurity, privacy and integrity.
Twitter’s lawyers argue that the release of information about Zatko’s severance should be conditioned on Musk’s lawyers handing over records of all communications since December between Musk, his advisers and co-investors that include Zatko.
The judge will also hear arguments on several other disputes about disclosure, or sharing of information, between lawyers for Musk and Twitter. They include efforts by Musk’s lawyers to obtain more data from a sample of about 9,000 Twitter accounts in the fourth quarter of 2021, and claims that Twitter is keeping much information as “privileged” or confidential. Musk’s lawyers also claim that Twitter is not properly hiding information about user metrics.
Meanwhile, lawyers for Twitter are asking the judge to sanction Musk’s lawyers for failing to produce responsive phone messages and to order them to comply with an earlier disclosure order.
