Twitter rejects Musk’s claims he was misled

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Twitter Inc. Thursday dismissed Elon Musk’s claims in a Delaware court that he had been misled into signing the deal to buy the social media company, saying it was “incredible and inconsistent with the facts.”

Musk made the claims in a counterclaim filed under seal last Friday and made public on Thursday.

According to Musk, he — the multi-company billionaire founder advised by Wall Street bankers and lawyers — was tricked by Twitter into signing a $44 billion merger agreement. That story is as improbable and factual as it sounds,” said the request, released by Twitter on Thursday.

Twitter’s submission is the latest salvo in what’s building to a increasingly bitter legal confrontation between the world’s richest person and the social media giant.

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The two sides are set to appear in court on October 17 after Musk sought to cancel his deal to take over Twitter over what he believes is a misrepresentation of fake accounts on the site.

The San Francisco-based company is trying to force Musk to honor the deal, accusing him of sabotaging it because it no longer served his interests.

A Musk representative did not immediately respond to a request for comment.

In the counter-claims made public on Thursday, Musk accuses Twitter of stepping up efforts to hide the true number of users as the market plummeted.

“While a long bull market was drawing to a close and the tide was fading, Twitter knew providing the information to the Musk parties would reveal that Twitter had been swimming naked,” the counterclaims say.

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Twitter counters that Musk has argued “not a shred of evidence” for these “fact-free” allegations.

‘FACT-FREE’ CHARGES

Musk also claims that “Twitter’s misrepresentations go much deeper than just providing false numbers” about his spam or fake accounts.

While “Twitter says there are 238 million daily monetized active users, users who actually see ads” is about 65 million lower, Musk says in the counterclaims.

Twitter claims the SEC disclosures about daily active monetized users were accurate.

Musk, the CEO of electric car company Tesla Inc., offered to buy Twitter in April for $54.20 a share, saying he believed in its potential as a global platform for free speech.

But he soured on Twitter as the stock price lagged his takeover bid, and began expressing skepticism that bot and spam accounts accounted for less than 5% of users.

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Musk attempted to withdraw on July 8 without paying a $1 billion termination fee, citing Twitter’s failure to provide details about bot and spam accounts. Twitter sued him four days later.

Earlier this week, Twitter issued dozens of subpoenas against banks, investors and law firms that supported Musk’s takeover bid, while Musk issued subpoenas to Twitter’s advisers at Goldman Sachs and JP Morgan for their work.

Legal experts have said Twitter’s requests suggested the company wanted to know why Musk was opposing it, or that it was waiving its obligation to secure sufficient funding.

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