Elon Musk, the CEO of Tesla, was unsuccessful in his attempt to delay Twitter’s lawsuit against him, as a Delaware judge on Tuesday set a trial date for October, citing the social media company’s “cloud of uncertainty” as a result of the billionaire’s decision to back out of an agreement to purchase it.
In September, Twitter requested a speedy trial, but Musk’s legal team recommended delaying it until the beginning of the following year due to the difficulty of the case.
Chancellor Kathaleen St. Jude McCormick, the chief judge of Delaware’s Court of Chancery, which hears numerous high-profile corporate issues, declared that “delay threatens irreparable harm.” “The risk increases with the length of the delay.”
Regarding the request by Musk’s team for a later date, McCormick said they underestimated the Delaware court’s ability to ‘quickly process complex litigation.’
Twitter is trying to force the billionaire to make good on his April promise to buy the social media giant for $44 billion — and the company wants it to happen quickly because it says the ongoing dispute is harming its business.
Musk, the world’s richest man, pledged to pay $54.20 a share for Twitter, but informed the company in July that he wants to back out of the agreement.
‘It’s attempted sabotage. He’s doing his best to run Twitter down,’ said attorney William Savitt, representing Twitter before McCormick on Tuesday. The hearing was held virtually after McCormick said she tested positive for COVID-19.
Musk has asserted that the business has broken its commitments under the agreement by sacking key executives and letting go a sizeable portion of its workforce, as well as by failing to disclose sufficient information regarding the amount of fictitious or “spam bot” Twitter accounts.
Musk’s team anticipates that more details regarding the bot numbers will surface during the trial court’s discovery phase, during which both parties are required to turn over evidence.
After agreeing to pay 38 percent more than Twitter’s stock price just before the stock market sank and shares of the electric-car manufacturer Tesla, where the majority of Musk’s personal wealth is concentrated, lost more than $100 billion of their value, Twitter claims that Musk’s justifications for pulling out are just a cover for buyer’s remorse.
Savitt questioned Musk’s desire for a delayed trial, asking “if the true goal is to drag out the clock,” and claimed that the contentious merger deal and Musk’s derogatory tweets about the company were harming the company.
According to Savitt, “He’s betting on squirming out of the arrangement he signed.”
However, it is absurd to think that the Tesla CEO is attempting to harm Twitter. He has no desire to harm the business, according to Musk’s lawyer Andrew Rossman, who also pointed out that Musk holds a ‘much higher investment’ in Twitter than the entire board of directors. Musk is Twitter’s second-largest stakeholder.
In order for Twitter to be able to make critical business choices affecting everything from employee retention to relationships with suppliers and consumers, Savitt underlined the significance of an expedited trial beginning in September.
As “one of the largest take-private deals in history” involving “a corporation that has a vast amount of data that has to be examined,” Rossman claimed that extra time is required. It is necessary to examine billions of actions on their site.