Lawyers for Twitter and Elon Musk will meet for the first time on Tuesday, July 19, during a preliminary hearing in an unprecedented legal battle between the world’s richest man and the social network, determined to be redeemed by its destroyer.
The platform launched lawsuits a week ago against the head of Tesla and SpaceX to force him to honor his commitment to acquire it for $44 billion.
And although she is going through an image crisis after months of attacks and denigrations by her former suitor, she is the favorite.
By “victory”, the expert refers to a decision by the judge that would force Elon Musk to buy the Californian group at the price agreed at the end of April (54.20 dollars per share) or to pay a large compensation.
The wealthy businessman unilaterally broke the deal on July 8, claiming that Twitter’s board of directors allegedly failed to provide him with reliable information about the number of fake accounts active on the network.
But the chances that he will come out paying only the damages for breaking the agreement (one billion dollars) or that he will be declared in his right are considered very low.
“not tender”
The litigation depends on the Delaware Court of Chancery, a court in this small state in the eastern United States, specializing in business law. Its president Kathaleen McCormick – the first woman in this position – has taken charge of the matter.
In its complaint, Twitter accused Elon Musk of showing “hypocrisy” and “bad faith.”
Lawyers for the company believe it has changed its mind in the face of the recent drop in stock valuations of tech companies.
Kathaleen McCormick is best known for having forced Kohlberg, a company that had also tried to break off an engagement, to buy the company in question, DecoPac.
The fate of the blue bird, a social network used around the world by politicians, celebrities, activists and influencers, appears to have little in common with that of less prominent organizations.
But “it’s not different enough, I think, for Delaware to risk its reputation by deciding not to implement the terms of the agreement,” says Adam Badawi.
“free electron”
The July 19 hearing should address the question of a possible trial date. Twitter requested an accelerated procedure, starting in September, so as not to prolong the period of uncertainty that partially paralyzes the company.
Elon Musk’s lawyers filed an appeal on Friday, July 15, not to open hostilities before next year.
They assure that experts will have to analyze “mountains of data” to demonstrate, as the billionaire assures, that the platform is full of automated accounts and spam, well above the 5% officially indicated.
The judge must also take into account the terms of the financial package negotiated with banks and investors, so as not to compromise the possibility of a takeover bid.
The employer and the board can still choose to agree on a slightly lower price and thus avoid the lawsuit.
In another case tried in Delaware, Musk “showed his will to go to the end,” adds the professor. “And he won. I don’t think his instinct is necessarily to compromise.”
Source: BFM TV
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