The specifics of Elon Musk’s countersuit against Twitter are being made public before a court makes them official on Friday.
A copy of Musk’s 164-page countersuit, which Insider was able to get, is jam-packed with complaints about the veracity of the social media company’s business assertions.
It is the most recent development in the conflict between Tesla’s multibillionaire CEO and Twitter since Musk declared his intention to back out of a $44 billion deal to acquire the social media platform.
The countersuit is a new development in the continuing legal battle around Musk’s attempt to withdraw from the agreement.
By Friday, Elon Musk’s response to the Twitter lawsuit will be made public.
Whether he is legally permitted to back out of the arrangement will be the subject of a trial between the two sides in Delaware court in October.
Musk claims he has the right to completely back out of the agreement because Twitter publicly assured investors that its user metrics-based revenue model was sound.
They are not there, according to Musk.
TWITTER COMMENTS ON MUSK’S REACTION TO THE SECOND-QUARTER REVENUE MISSING
Musk terminated the agreement in July after insisting on more information from Twitter regarding the quantity of spam or bot accounts using the service.
In an effort to boost its user numbers, the company is allegedly “miscounting” the amount of spam accounts it hosts on purpose in order to deceive investors about the company’s prospects.
Additionally, he argues that Twitter’s reliance on the indicator of monetizable daily active users (mDAU) as a foundation for revenue is deceptive in and of itself.
ELON MUSK-TWITTER TRIAL TO BEGIN IN OCTOBER
Twitter reacted by labeling Musk’s justification “a fabrication, created in an effort to escape a merger deal that Musk no longer deemed desirable” in a filing on Thursday in Delaware Chancery Court.
TWTR TWITTER INC., ticker security last change change% 41.97 0.90 2.19% Tesla Inc.’s stock price was 875.64 at the time. Twitter’s answer reads, “The Counterclaims are a made-for-litigation story that is disproved by the evidence and plain sense.” According to the Associated Press, “Musk fabricates claims Twitter never made and then attempts to use, selectively, the vast amount of confidential information Twitter handed him to create a breach of those claimed claims.”
According to Twitter’s attorneys, Musk’s counterclaims were initially not made public because they purportedly included confidential company information that needed to be redacted.