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Elon Musk vs Twitter legal battle intensifies, Tesla CEO accuses tech giant of fraud in buyout deal

Elon Musk argued in the filing to a Delaware court that the number of users who can be shown advertising on the platform is far below the firm's figures. This conflict started when Musk offered Twitter's board $54.20 per share in April, only to announce in July that he was ending their partnership because the company had lied to him about the number of bogus and spam accounts it had collected.

Elon Musk vs Twitter legal battle intensifies Tesla CEO accuses tech giant of fraud in buyout deal gcw
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New Delhi, First Published Aug 6, 2022, 10:58 AM IST

As the legal battle intensifies, Elon Musk has accused Twitter of fraud, claiming the social media network deceived him about important parts of its business before he agreed to a $44 billion takeover. In an effort to counter Twitter's lawsuit attempting to compel him to consummate the acquisition, which he has attempted to cancel, the Tesla CEO filed the claim late on Thursday.

Musk contended in a document submitted to a Delaware court that the platform's real user base is around 65 million users fewer than the company's estimate of 238 million users. The accusation stated that "Twitter's disclosures have gradually come undone, with Twitter hastily locking the gates on information in a desperate attempt to prevent the Musk Parties from revealing its fraud."

The trial is scheduled to begin on October 17, and Musk is requesting that the judge release him from the contract and order Twitter to pay him damages. Billions of cash are on the line, but Twitter's survival is also in jeopardy due to Musk's absolutist attitude that the platform should let any lawful speech, which has raised concerns that it may be used to encourage violence.

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Twitter dismissed the erratic billionaire's claim in its own lawsuit, labelling it "as absurd and contrary to truth as it sounds." Musk, a multi-billionaire entrepreneur who received legal and financial advice from Wall Street, said that Twitter tricked him into signing a $44 billion merger agreement.

Musk's countersuit, which was eventually made public on Thursday, was submitted last week along with a legal argument to refute Twitter's assertion that he is contractually obligated to complete the acquisition. The businessman claimed that Twitter not only misled him but also US market authorities.

In his court statement, Musk claimed that he relied on Twitter's SEC filings because he found it "expensive and inefficient" to do his own due diligence and assess the company's valuation.

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The legal battle is intensifying as plans are being made for the five-day trial in Delaware's Chancery Court, which focuses on difficult, important corporate litigation.

This conflict started when Musk offered Twitter's board $54.20 per share in April, only to announce in July that he was ending their partnership because the company had lied to him about the number of bogus and spam accounts it had collected.

Also Read | 'Ancient times': Elon Musk reacts to his business card from 1995 which has gone viral

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