A Delaware judge is hearing arguments over the exchange of information by lawyers for Twitter and Elon Musk in a lawsuit in which the social media giant is seeking to force Musk to carry through with his $44 billion acquisition of Twitter.
Tuesday's hearing comes three weeks before a scheduled trial in the lawsuit and a day after scheduled depositions of Musk and Twitter CEO Parag Agrawal were postponed. Musk is now scheduled to be deposed in Delaware on Oct. 6 and Oct. 7, according to a Twitter court filing late Monday.
Musk, the world’s richest man, agreed in April to buy Twitter and take it private, offering $54.20 a share and vowing to loosen the company’s policing of content and to root out fake accounts. In July, Musk indicated that he wanted to back away from the deal, claiming Twitter had failed to provide him enough information about the number of fake accounts on its platform.
The hearing will begin with arguments on a motion by Musk’s attorneys to revise their answer to the lawsuit and their counterclaims against Twitter for the second time. Musk’s attorneys want to add information regarding a severance agreement and $7.75 million payment to former employee Peiter "Mudge" Zatko. Musk’s attorneys assert that Twitter needed his consent before making the payment but failed to do so.
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Zatko is a cybersecurity expert who was the head of security for Twitter until he was fired early this year. He filed a whistleblower complaint in July with Congress, the Justice Department, the Federal Trade Commission and the Securities and Exchange Commission. The complaint outlines a host of accusations against Twitter, including that CEO Parag Agrawal and other senior executives and board members have made false and misleading statements about Twitter’s cybersecurity, privacy and integrity.
Twitter attorneys argue that the inclusion of information about Zatko’s severance should be conditioned on Musk attorneys turning over records of all communications since December among Musk, his advisers and co-investors that involve Zatko.
The judge will also hear arguments on several other disputes regarding discovery, or the exchange of information, between attorneys for Musk and Twitter. They include efforts by Musk lawyers to obtain more data from a sampling of about 9,000 Twitter accounts in the fourth quarter of 2021, and claims that Twitter is withholding too much information as "privileged," or confidential. Musk attorneys also claim that Twitter is improperly withholding information regarding user metrics.
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Attorneys for Twitter, meanwhile, are asking the judge to sanction Musk attorneys for failing to produce responsive phone messages, and to order them to comply with a previous discovery order.
