The amended counterclaim comes as Musk and Twitter are preparing for a trial that will begin on October 17.
Elon Musk’s legal team on Thursday amended its counterclaim against Twitter to include accusations by the social media giant’s former security chief, Pater “Maj” Zatko.
In the counterclaim, Musk alleges that Twitter violated its obligations under the $44 billion acquisition agreement by misrepresenting the total amount of spam and fake accounts on its platform. Twitter claims that spam and fake accounts make up less than 5% of its users.
“Needless to say, the latest revelations make it irrefutably clear that Musk’s parties have every right to opt out of the Merger Agreement—for numerous independently sufficient reasons,” the document reads.
In July, Zatko filed an 84-page complaint with Congress, the U.S. Securities and Exchange Commission, the Federal Trade Commission, and the Department of Justice, accusing Twitter of “extreme, egregious flaws” in its cybersecurity. This week, he testified before the Senate Judiciary Committee that the government of India posted an agent on Twitter and that he became aware of “at least one agent” of the Chinese government intelligence service who was “on the payroll.”
In addition to Twitter’s security flaws, Zatko stated in the complaint that Twitter executives “have no interest in accurately ‘detecting’ or reporting spammer bots on the platform.” Instead, they are ostensibly interested in increasing the company’s monetizable daily active users (mDAU) with bonuses that could exceed $10 million. He also claims that Twitter does not have the resources to fully understand the true number of bots on the platform.
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“Faced with Zatko’s devastating analysis, Twitter did what Elon Musk did when he started raising questions about fake and spam accounts and mDAUs: Ignored and covered up the issues and attacked Messenger,” Musk’s amended counterclaim says. ..
“As for Musk, Twitter blocked his information requests, violating his rights under the Merger Agreement, and then brought this groundless lawsuit after he rightfully terminated the deal. Both episodes show the huge and illegal measures Twitter will go to to avoid revealing the true state. company – its “key” financials, security infrastructure, intellectual property infringement and legal compliance – to the public.”
“In short, Musk’s parties and many other Twitter investors were sold to a company different from the one that actually exists — a company that was more valuable, more popular, more secure, and more compliant with applicable law,” the lawsuit adds.
The amended counterclaim comes as Twitter prepares to sue Musk in a five-day trial due to begin on October 17. In addition to the countersuit, Musk filed three separate notices of termination in an attempt to back out of the deal. , which Twitter called “invalid and illegal”.
“Mr. Musk’s statements are factually inaccurate, legally insufficient, and commercially inappropriate,” a Twitter spokesperson told FOX Business on Friday. “We look forward to trial in the Delaware Court of Chancery.”
On Wednesday, Twitter shareholders voted to acquire Musk.
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