Elon Musk Gives New Reasons to End Twitter Contract, Citing Whistleblower – Featured Bitcoin News

Elon Musk Gives New Reasons to End Twitter Contract, Citing Whistleblower – Featured Bitcoin News

Tesla CEO Elon Musk outlined new reasons for terminating the $44 billion deal to buy Twitter in a new filing with the US Securities and Exchange Commission (SEC). Citing a whistleblower report, Musk’s lawyer said the allegations, known to the social media giant but not disclosed to Musk, indicated “far-reaching misconduct on Twitter.”

Elon Musk lays out multiple reasons for terminating his Twitter contract in a new SEC filing

Tesla CEO Elon Musk has found more reasons to drop a $44 billion bid to buy Twitter Inc. Musk’s lawyer submitted letter he sent on Twitter with the US Securities and Exchange Commission (SEC) on Monday to provide additional notice of termination of the agreement.

Musk officially called off his bid to buy Twitter on July 8. Twitter later sued the head of Spacex to force him to close the deal, prompting Musk to do so counterclaim of the social media giant.

In a letter to Twitter Chief Legal Officer Vijay Gadda, Musk’s lawyer detailed:

Allegations regarding certain facts known to Twitter prior to and as of July 8, 2022, but not disclosed to the Musk parties before and at that time, have since come to light that provide additional and clear grounds for termination of the merger agreement.

The letter refers to a whistleblower report to Congress, the SEC, the Federal Trade Commission (FTC) and the Department of Justice (DOJ) filed on July 6 by Peiter “Mudge” Zatko, Twitter’s former chief security officer. The report was recently published in the Washington Post.

Musk’s attorney argued that “Zatko’s complaint alleges widespread misconduct at Twitter — all of which was disclosed to Twitter’s directors and senior executives, including [CEO] Parag Agrawal – it’s likely to have serious ramifications for Twitter’s business.”

For example, Zatko argued that “Twitter is in significant non-compliance” with respect to data privacy, unfair trade practices, and consumer protection laws and regulations. Moreover, he said Twitter is violating the consent decree it entered into with the FTC in 2011.

Stating that “Twitter’s platform is substantially built on the appropriation and infringement of third-party intellectual property,” the whistleblower claimed:

Twitter is uniquely vulnerable to system disruptions resulting from data center failures or malicious actors, a fact that Twitter’s leadership (including its CEO) has ignored and tried to cover up.

Moreover, Zatko explained that “Twitter’s SEC filings contained untrue statements of material fact or omitted to state material facts necessary for the statements therein not to be misleading.”

He further alleged that “Twitter’s CEO, Parag Agrawal, knowingly presented false and misleading reports to Twitter’s board of directors to cover up flagrant vulnerabilities in Twitter’s security and data protection infrastructure.”

Numerous authorities in various countries are currently investigating Zatko’s allegations, Musk’s lawyer reported, adding:

Twitter will now also face a myriad of civil lawsuits, seeking claims under various privacy and cybersecurity laws, state consumer protection laws, false advertising laws, theft and misappropriation of intellectual property, and common law claims such as wrongful enrichment, fraud and breach of contract.

There are also intellectual property issues. The whistleblower revealed that “Twitter apparently never acquired the rights to Twitter’s core machine learning models, which the Musk parties understand are fundamental to the Twitter platform itself,” Musk’s lawyer wrote.

The case is scheduled to go to trial in Delaware Chancery Court for five days, beginning on October 17. However, Musk’s legal team is seeking to delay the trial by a month in light of the disclosure of the whistleblower.

Do you think Elon Musk has enough reasons to walk away from a $44 billion deal to buy Twitter? Let us know in the comments section below.

Elon Musk Gives New Reasons to End Twitter Contract, Citing Whistleblower – Featured Bitcoin News

Kevin Helms

An Austrian economics student, Kevin discovered Bitcoin in 2011 and has been an evangelist ever since. His interests lie in bitcoin security, open source systems, network effects, and the intersection between economics and cryptography.

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