Elon Musk’s Lawyers File Third Termination Notice for Twitter Deal

Elon Musk on Friday sent yet another letter to Twitter, terminating his $44 billion USD acquisition of the company — reports The Verge.

This time, Musk’s lawyers cited Twitter’s sizeable severance payment of around $7 million USD to ex-security chief Peiter “Mudge” Zatko as cause for termination. The letter was addressed to Twitter’s chief legal officer, Vijaya Gadde, and included by Twitter in an SEC filing.

According to the letter, Musk’s merger agreement with Twitter prohibited the company from making any extraordinary severance payments. While Zatko was an executive-level employee at Twitter, Musk sees his termination payment as a violation of the agreement.

Musk originally filed to terminate his Twitter bid in July. He argued that Twitter understated the number of bot accounts on its platforms and withheld information he needed to independently verify those calculations, constituting a “material breach” that was grounds to terminate the deal.

Twitter responded by suing Musk to follow through on the acquisition.

In a second legal notice last month, Musk and his lawyers asserted that Zatko’s recent claims of “far-reaching misconduct at Twitter” and the resulting consequences for the company’s business release Musk from his obligations under the pair’s agreement.

Musk also subpoenaed Zatko, and a deposition was scheduled for this Friday.

Zatko filed legal complaints against Twitter in July, alleging that the company had lackluster security, misled regulators, and had no means of actually knowing how many active bot accounts plagued its social network.

Musk and Twitter are set to meet in court on October 17, where Judge Kathaleen McCormick will decide if Musk is within his rights to back out of the deal.

McCormick earlier this week denied a request from Musk’s legal team to delay the trial. However, she did rule that Musk would be allowed to bring up Zatko’s claims at trial to support his case. McCormick has permitted a “limited” discovery on documents pertaining to the whistleblower’s report.