This week at Elon, we’re talking M&A again—but this time, we mean mergers and acquisitions—not marriages and relationships.
The Delaware Court of Chancery handed Elon Musk a fast-track schedule last month in his ongoing fight to not buy Twitter, and now we have specific dates for the trial: Elon and Twitter will split from October 17th to October 21st. That leaves two and a half months for the two sides to fight over what evidence to present, and Twitter is already digging in — while Musk has been preparing a counterattack with whatever dirt he has.
like Washington Post and the newsletter The Chancery Daily reported Earlier this week, Twitter cast a wide net calling for Musk’s business deals. Information is being sought from high-profile deal participants like Marc Andreessen, as well as longtime friends of Musk like the organizers of the All-In Summit, where Musk spoke at length about Twitter’s alleged bot problems, shortly after he declared in unilateral way pending agreement.
The targets, of course, are not too happy about this. Palantir founder Joe Lonsdale, who tweeted about receiving a subpoena, called it a “giant harassing fishing expedition,” while Everything inside podcast co-host David Sacks replied with a photo a Crazy magazine cover with the middle finger.
It remains funny that so much of this drama is taking place on Twitter, a platform that Musk is portraying as hopelessly broken and that it is speculated could be as much as “80 percent or 90 percent” bots at the summit.
Musk did a lot of work recruiting people to make the Twitter deal happen, and Twitter is apparently hoping it can come back to haunt him in court — on top of everything he’s said publicly on Twitter itself. So the company is searching through Musk’s extensive Silicon Valley Rolodex for statements that contradict his dire claims about bots or indications that he might be more upset about other things, like the stock market slump and his wealth in decline
Some of Musk’s associates had their own interest in the deal: days before Musk’s “pending” tweets, for example, All-In Summit co-organizer Jason Calacanis had been looking for investors who could back Musk’s initiative.
This is just one part of Twitter’s information-seeking campaign. While Musk has filed several subpoenas of his own, the full list so far is extremely heavy on the Twitter side, including more than a dozen banks and several investment firms. Twitter also seeks a wealth of details about Tesla’s business operations, including the stock Musk sold to finance the acquisition.
For his part, Musk tapped content moderation company TaskUs and data analytics firms Concentrix and Innodata, credibly to support his claims that Twitter lied about its bot-catching capabilities.
Musk’s lawyers have been busy on their own, though it wasn’t immediately clear like Busy. Earlier this week, he filed his countersuit against Twitter. It has spent the last few days under seal as both sides battle over how and when to release its details.
Twitter claims Musk caught the company sending a copy late last week and then trying to unlock it early. A letter from her attorney says Musk’s counterclaim refers “extensively to internal Twitter information and data” and asks for time to make redactions in the 163-page document.
Musk’s lawyer cast the delay in a more sinister light, stating that “nothing” in the lawsuit is confidential and “Twitter should not be allowed to continue to bury the side of the story that it does not want to reveal publicly.” Twitter won a hearing, giving the company until Friday afternoon to propose changes.
[Update: Since publication, Twitter has released the lawsuit and a response, which is composed largely of burns on Elon Musk.]
Musk received access to a large amount of Twitter data as part of his purchase, including a “firehose” API of posted tweets. There’s plenty of information he could throw out in a countersuit, where he’ll likely try to argue that Twitter intentionally misrepresented his claims in a way that would violate their agreement.
It is not clear that Musk WILL make a convincing version of this case because it is not clear that there is a convincing version of this case. If he was sitting on a bomb that would reveal the deception, he would have had plenty of opportunity to detonate it.
However, if there’s one thing tech companies know by now, it’s that a hostile audience given access to too much data will find SOMETHING evil looking in it. Think of it as an extension of Masnick’s Impossibility Theorem, which states that good content moderation at scale is impossible. And if Musk can’t have Twitter on his terms, he may be more than happy to attack it any way he can.
Twitter has a very real, ongoing battle with fake or duplicate accounts. At least some details from its API may reflect this. How well Musk could handle this as Twitter completely full of bots or any other objectionable content – not only to the court itself, but also to the public – is still an open question. And plenty of people want a piece of Twitter, including Texas Attorney General Ken Paxton, who was embroiled in its investigation earlier this year.
In a worst-case scenario for Twitter, Musk could find information that prompts new demands from regulators. In one the strangest-Case scenario, he discovers something harmful on Twitter… but loses the case and has to mess with those regulators as its owners.
like of Bloomberg Matt Levine has been keen to point out, making Twitter look bad doesn’t necessarily get Musk out of the deal, and Musk bought Twitter in part BECAUSE he knew there were a lot of robots and he wanted to get rid of them. But legal filings are a great place to learn things companies generally don’t want you to know, and as the Twitter lawsuit heats up, Musk may decide he wants to punish Twitter simply by using public records.
Outside of the court battle, there has been one comparatively quiet week for Musk. Yes, some SpaceX debris, described as an “alien obelisk”, may have landed on an Australian farm. And apparently his dad isn’t proud of him — or at least wants people to give the rest of the Musk family a little more airtime. But check out this adorable Shiba Inu video he tweeted! We can only hope that Twitter will call them out as well.
