US Court Accepts Twitter's Request, Musk Lawsuit to Begin in October

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Twitter has gained an advantageous position by securing a court decision for an expedited trial in its lawsuit to invalidate Elon Musk, Tesla CEO's, termination of the acquisition agreement.

According to the Wall Street Journal (WSJ) and others, the Delaware Court of Chancery accepted Twitter's request for an expedited trial on the 19th (local time) and announced that the hearing will begin in October. This rejected CEO Musk's demand to delay until after February next year citing preparation of materials, siding with Twitter. Accordingly, a five-day expedited trial will be conducted.

Judge Kathleen McCormick agreed with Twitter's argument, stating that if the hearing is delayed, the uncertainty cloud over the seller, Twitter, will grow and cause irreparable damage. Twitter's legal team argued during the preparatory hearing that CEO Musk attempted sabotage and that Twitter's operations have been adversely affected every day and every hour since the declaration of termination of the acquisition agreement.

CEO Musk claimed that Twitter's failure to properly provide data related to fake accounts constituted a 'material adverse effect' (MAE) justifying contract termination. However, local media reported that the Delaware court has largely not recognized this claim.

CEO Musk agreed to acquire Twitter at $44 billion, or $54.20 per share, at the end of April but later notified termination of the acquisition citing the fake account issue. In response, Twitter filed a lawsuit demanding contract enforcement against CEO Musk. The previously signed contract included a clause requiring a $1 billion penalty if the acquirer fails to secure funding or if regulatory authorities block the acquisition.

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