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Elon Musk’s backlash against Twitter says it misled him

  • Elon Musk filed a confidential lawsuit against Twitter late last week.
  • Musk makes several claims against Twitter, including the accuracy of its user metrics.
  • Musk claims Twitter is trying to “distract” attention from his many “falsifications.”

Elon Musk’s confidential 164-page counterattack against Twitter is full of accusations about the validity of the social media company’s business claims, according to a copy obtained by Insider.

The counterattack is another escalation in the ongoing legal dispute over Musk’s attempt to back out of his $44 billion deal to buy Twitter. The billionaire and the platform are already scheduled to face off in a trial in October in Delaware court over whether he is legally able to back out of the deal to acquire the platform.

In his counterclaims, Musk argues at length that he is entitled to walk out of the deal entirely. He claims he was led to believe Twitter’s public assurances to investors that its business, based on user metrics, was good. They are far from it, he claims. For months, Musk publicly argued that Twitter had more “bots,” or spam accounts, than it admitted. After pressing for more and more information on the matter, in early July he decided to cancel the deal.

Now, he accuses the company of intentionally “miscounting” the number of spam accounts it hosts in order to skew its user metrics “as part of its scheme to mislead investors about the company’s prospects.”

Twitter’s lawsuit to enforce the merger agreement is “filled with personal attacks against Musk and fancy rhetoric aimed more at a media audience than this court” and “is nothing more than an attempt to distract from these misrepresentations,” Musk’s counterclaims said.

“This has been Twitter’s strategy all along: to distract and obfuscate the truth about its revelations — first from its investors and then from Moscow parties when they began to discern the truth,” the claims continue.

Musk’s counterclaims were initially not available to the public because the lawsuit allegedly contained private company information that needed to be redacted, Twitter’s lawyers argued. After days of wrangling between lawyers on each side, the judge overseeing the case in Delaware court said the lawsuit had to be made public by Friday.

Musk faces an uphill battle in trying to get out of the deal because of the ironclad contract he signed earlier this year, multiple experts told Insider.

But his countersuit is an attempt to create a path out of the deal. While Twitter has repeatedly pointed out that Musk waived his right to information before signing the merger agreement, Musk says he followed the traditional path of “trust but verify,” meaning he trusted Twitter’s public disclosures and proceeded to ratify them after, and negotiated the right to do so.

“The Musk parties … fully expected that Twitter would not hide anything from its would-be owner, including the extent of its fake or spam account problem,” the complaint states. “Instead, the opposite happened. Twitter played a months-long game of hide-and-seek to try to run out the clock before the Moscow parties could discern the truth about these representations, which they had to shut down. The more Twitter avoided even with simple inquiries, the more Musk’s parties suspect that Twitter had misled them.”

This is breaking news. Check back for updates.

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