Elon Musk countersues Twitter over $44bn deal amid fresh legal action by shareholder

theguardian.com:

Elon Musk has countersued Twitter, escalating his legal fight against the social media company over his bid to walk away from the $44bn purchase.

Musk’s lawsuit was filed on Friday, hours after chancellor Kathaleen McCormick of the Delaware court of chancery ordered a five-day trial beginning 17 October to determine if Musk can walk away from the deal.

The entrepreneur’s 164-page document was not publicly available, however under court rules a redacted version could soon be published.

Twitter did not immediately respond to a request for comment.

Also on Friday, Musk was sued by a Twitter shareholder who asked the court to order the billionaire to close the deal, find that he breached his fiduciary duty to Twitter shareholders and award damages for losses caused.

The lawsuit, which seeks class status, alleges Musk owes a fiduciary duty to Twitter’s shareholders because of his 9.6% stake in the company and because the takeover agreement gives him a veto of many of the company’s decisions. The lawsuit was filed by Luigi Crispo, who owns 5,500 Twitter shares, in the court of chancery.

Musk, the world’s richest person and chief executive of Tesla, said on 8July he was abandoning the takeover and blamed Twitter for breaching the agreement by misrepresenting the number of fake accounts on its platform.

Twitter sued days later, calling the fake account claims a distraction and saying Musk was bound by the merger contract to close the deal at $54.20 per share. The company’s shares ended on Friday at $41.61, the highest close since Musk abandoned the deal.

McCormick fast-tracked the case to trial last week, saying she wanted to limit the potential harm to Twitter caused by the uncertainty of the deal.

Twitter has blamed the court fight for