Musk’s attorneys say Twitter stalling on document production

PTI, Jul 27, 2022, 8:54 AM IST

Attorneys for billionaire Elon Musk are complaining that Twitter is slow-walking document production in advance of an October trial to decide whether the Tesla CEO should be forced to complete a $44 billion acquisition of the social media company.

Musk’s lawyers also said in a court filing Tuesday that Twitter Inc. attorneys have refused to consent to a proposed Oct. 17 trial date and are insisting on an Oct. 10 trial start, using the uncertainty over a trial date to delay other scheduling discussions.

Attorneys for Musk claimed that Twitter’s proposed case schedule is “an obvious attempt to squeeze defendants” after a Delaware Chancery Court judge agreed last week to hold an expedited trial in a lawsuit filed by Twitter.

“Given the compressed timeframe, guidance from the court is necessary to break the impasse to allow things to move forward promptly,” attorney Edward Micheletti wrote in asking Chancellor Kathaleen St. Jude McCormick to grant Musk’s proposed case schedule.

“Defendants’ efforts to make sure this case is trial-ready by October, have not been reciprocated by Twitter, who at every turn has sought to delay,” he added.

A spokesman for Twitter said the company had no comment on Tuesday’s court filing.

Musk agreed in April to buy Twitter and take it private, offering $54.20 a share and vowing to loosen the company’s policing of content and to root out fake accounts. As part of the deal, Musk and Twitter had agreed to pay each other a $1 billion breakup fee if either was responsible for the deal collapsing. Twitter shares were trading Tuesday afternoon at $39.24, well off a 52-week high of $71.92.

Musk, the world’s richest man, indicated earlier this month that he wants to back away from the deal, prompting Twitter to file a lawsuit to hold him to what it describes as a “seller-friendly” agreement.

With an October trial looming, Micheletti told the judge Tuesday that Twitter has refused to begin producing certain categories of documents that are “plainly relevant” and “easily collected and produced.” He said Twitter lawyers instead have claimed that several categories of documents are not relevant, without identifying them.

The documents sought by Musk’s attorneys include Twitter board minutes and related materials, advertising sales and metrics, and manuals and policies regarding “Monetizable Daily Active Usage or Users,” or mDAU. That is a metric that Twitter uses to measure the number of people or organizations using its platform.

Musk has claimed that Twitter has failed to provide him enough information about the number of fake accounts on its service, but the company has estimated for the past several years that fewer than 5% of mDAU are spam or fake accounts.

Musk’s attorneys also contend that Twitter has refused to provide them with raw data that it maintains in the ordinary course of business, and which require significant “machine time” and software development to be processed and analyzed by expert witnesses by a proposed Monday deadline.

Twitter said last month that it was making a “fire hose” of raw data on hundreds of millions of daily tweets available to Musk.

Attorneys for Musk are asking McCormick to approve the Oct. 17 trial date, and to order Twitter to immediately produce “core documents” and to produce all raw data by Monday.

“Given the timeline until trial, every day counts,” Micheletti wrote. Tuesday’s court filing suggests that Musk plans to file his answer to Twitter’s complaint later this week.