Elon Musk vs. Twitter Lawsuit: Why Is the Tesla CEO Fighting Back With Countersuit?

(Photo : Win McNamee/Getty Images)
WASHINGTON, DC - MARCH 09: Elon Musk, founder and chief engineer of SpaceX speaks at the 2020 Satellite Conference and Exhibition March 9, 2020 in Washington, DC. Musk answered a range of questions relating to SpaceX projects during his appearance at the conference.

According to a source familiar with the matter, Elon Musk intends to sue Twitter again in the near future in his latest effort to back out of his $44 billion deal to purchase the social media company.

Musk's attorneys are trying to persuade the Delaware Court of Chancery judge to give them extra time and authority to acquire data regarding Twitter bots. A lengthy legal dispute may also possibly hurt the company's stock, giving Musk additional negotiating power to reduce the price of Twitter's acquisition.

Twitter Urges a Fast Trial Against Elon Musk

The information comes less than a week after Twitter filed a lawsuit against Musk in Delaware, claiming that the billionaire agreed to purchase the website before trying to "trash the company, disrupt its operations, destroy shareholder value, and walk away."

From last Tuesday, when Twitter filed its lawsuit, Musk has 20 days to submit his own counterclaims. Musk has claimed that he is entitled to terminate the agreement since Twitter hasn't given him enough information regarding fake accounts on the site, and Twitter wants the court to order him to buy Twitter at the agreed-upon price of $54.20 per share.

Tuesday is the day of the first hearing in Twitter's case, at which Delaware Court of Chancery chancellor Kathaleen McCormick is anticipated to rule on Twitter's request for a speedy trial.

Musk wants the trial to begin no sooner than February 2023, while Twitter's attorneys are asking for a four-day trial beginning in September. McCormick would also hear Musk's countersuit. Robert T. Miller, a professor of business and finance law at the University of Iowa, stated in a Wells Fargo investor note obtained by The New York Post on Monday that the chancellor is "certain to accept" Twitter's request for a speedy trial.

Elon Musk May Still Object To Purchase Twitter

Given the size of the transaction and the potential consequences of Musk's reluctance to comply, several legal experts believe the Court of Chancery won't force Musk to purchase Twitter. Miller counters that "all the incentives for Delaware cut in favor of ensuring that the large folks be treated equally with everyone else."

Miller claimed that Musk could physically object to signing the documents necessary to finalize the transaction if the court finally finds that he must purchase Twitter.

Miller claims that in that situation, Delaware has the authority to choose a representative known as a "special master" to act on his behalf. Musk may also be found in contempt of court, which could result in penalties or even jail time, per MarketWatch.

Chancellor McCormick said she had tested positive for COVID-19 and will judge via Zoom during the 90-minute session on Tuesday. With a $54.20 price target, Wells Fargo analysts predict that Twitter will prevail and the transaction will close at the initial price. On Monday, Twitter shares rose 1.8 percent to settle at $38.41, suggesting persistent uncertainty on Wall Street as a whole.

Moreover, while Musk is involved in a legal dispute with Twitter, he recently disclosed that he is the father of 10 children by three different women. But none of that will stop Elon Musk from taking a lavish trip to Greece with friends.

Per Daily Mail, the 51-year-old founder of SpaceX and Tesla was spotted on Monday relaxing in the sun and sipping cocktails aboard a boat off the shore of the island of Mykonos. He was accompanied by celebrity agent Ari Emanuel, 61, who served as the inspiration for HBO's Entourage, and his new wife, fashion designer Sarah Staudinger, 33, who founded the Staud fashion label.

Natasha Bassett, a 27-year-old Australian actress who is the most recent model to be romantically linked to the billionaire, was not spotted with the group. In May, they were spotted dining together in St. Tropez, France, and they attended Ari and Sarah's wedding, which was conducted by Larry David.