Musk accuses Twitter of deliberately miscounting spam users in countersuit

theguardian.com:

Elon Musk has accused Twitter of deliberately miscounting the number of spam accounts on its platform as part of a “scheme” to mislead investors.

The Tesla chief executive made the allegations in a countersuit against the social media company, which is taking Musk to court in an attempt to make him complete an agreed $44bn (£36.5bn) takeover of the business.

Musk repeats a claim that Twitter miscounts the amount of false and spam users on its platform as part of a “scheme to mislead investors about the company’s prospects”, according to the suit, which was unsealed on Friday. Valid user numbers are a key metric for Twitter, which makes 90% of its revenue from advertisers.

The suit says Twitter’s disclosures to the US financial watchdog are inaccurate and have distorted the value of a company that Musk has agreed to buy for $54.20 a share.

It says filings to the Securities and Exchange Commission (SEC) contain “numerous, material misrepresentations or omissions that distort Twitter’s value and caused the Musk Parties to agree to acquire the company at an inflated price”.

Referring to Twitter’s suit demanding Musk buy the company, it adds: “Twitter’s Complaint, filled with personal attacks against Musk and gaudy rhetoric more directed at a media audience than this Court, is nothing more than an attempt to distract from these misrepresentations.”

Twitter has consistently stated that spam accounts represent less than 5% of its user base, which currently stands at just under 238 million.

Musk claims that Twitter has overstated the number of monetisable daily active users on the platform, or users who see ads. The number of users that see ads is 65 million lower, the lawsuit claims.

Spam accounts are automated, meaning they are not