Twitter prepares to sue Elon Musk, hires an elite law firm to merge

Twitter has hired an elite law firm to handle the highly anticipated lawsuit against Elon Musk, which could be filed any day now.

After Musk pulled out of his $44 billion deal to buy Twitter on Friday, Twitter CEO Brett Taylor He said The company will sue Musk to enforce the merger contract and force him to complete the “deal on agreed price and terms.” Bloomberg reported that Twitter then hired “merger law heavyweights” Wachtel, Lipton, Rosen and Katz to work on a lawsuit expected to be filed earlier this week in Delaware Chancery Court.

“Wachtel Lipton may have the leading litigation practice in Delaware, where the majority of US public companies are incorporated,” the Financial Times wrote. “It defends companies in lawsuits for breach of fiduciary duty and breach of state merger agreements.”

Bloomberg wrote that Wachtell provides Twitter “access to attorneys including Bill Savitt and Leo Strain, who served as counsel for the Delaware Court of Appeals.” Wachtell has previously represented Musk and Tesla on other matters.

To defend against Twitter’s lawsuit, Musk has hired Quinn Emanuel Urquhart & Sullivan. “The company led his successful defense against a defamation lawsuit in 2019 and is representing him as part of an ongoing shareholder lawsuit over his failed attempt to take Tesla private in 2018,” Bloomberg wrote.

The merger contract may force Musk to close the deal

Twitter’s stock continued its decline, with a decline of more than 8 percent in today’s trading so far. The share price is under $34 as of this writing, while Musk has agreed to buy the company for $54.20 per share.

The Twitter/Musk deal includes a $1 billion breakup fee that applies in some circumstances, but Twitter could try more than that. As we wrote, the merger deal states that if Twitter fulfills its obligations under the agreement, it “is entitled to specified performance or other fair compensation” for causing the stock investor to [Musk] To finance equity financing, or to enforce the equity investor’s obligation to directly finance equity financing, and to complete the closing process. “

Musk alleged that Twitter violated the merger agreement in his letter on Friday to inform the company that he had terminated the deal. Musk’s claims center on his attempts to obtain more information about Twitter’s spam estimates, with the message saying:

While Section 6.4 of the Merger Agreement requires Twitter to provide Mr. Musk and his advisors with all data and information requested by Mr. Musk “for any reasonable business purpose in connection with the completion of the Transaction”, Twitter has not complied with its contractual obligations. For nearly two months now, Mr. Musk has sought the data and information needed to “make an independent assessment of the prevalence of fake accounts or spam on the Twitter platform”… This information is essential to Twitter’s business and financial performance and is necessary in order to complete the transactions set out in the merger agreement because it Necessary to ensure Twitter meets the terms of the shutdown, facilitate Mr. Musk’s financing and financial planning for the transaction, and participate in business transition planning. Twitter fails or refuses to provide this information. Sometimes Twitter ignores Mr. Musk’s requests, sometimes rejects them for seemingly unjustified reasons, and sometimes claims to be complying while Mr. Musk gives incomplete or unusable information.