Twitter is suing Elon Musk for calling off the $44 billion sale of the company. The suit, filed Tuesday in Delaware’s Court of Chancery, seeks to force the sale that the media mogul attempted to back out of last week.
“Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away,” says the lawsuit.
Following Musk’s agreement with Twitter to buy the company in April 2022, the suit aims to “compel Musk to fulfill his legal obligations, and to compel consummation of the merger upon satisfaction of the few outstanding conditions.”
Last week, Musk tried to call off the sale claiming in an SEC filing that the social media company had failed to provide data he requested on the total number of spam and fake accounts on the platform. In response, Twitter’s board chairman Bret Taylor tweeted its commitment “to closing the transaction on the price and terms agreed upon with Mr. Musk” and threatened “to pursue legal action to enforce the merger agreement.”
Musk’s announcement Friday resulted in Twitter shares dropping 11%, to $32.65. They rebounded somewhat Tuesday, by 3.4%.
In April, Twitter agreed to Musk’s $44 offer to buy the company, sparking controversy regarding what the media mogul’s leadership might mean for the app.
Following the deal’s announcement, Media Matters for America, a liberal non-profit watchdog group, warned that Musk’s ownership “will open the floodgates of misinformation, hate and lies,” resulting in the reversal of Twitter’s work to omit misinformation from the app and might mean that Donald Trump’s account would be restored.
Pamela Chelin contributed to this report.