Musk says Twitter whistleblower payment is another reason to scrap merger

Twitter emblem and inventory graph are seen by way of a magnifier displayed on this illustration taken September 4, 2022. REUTERS/Dado Ruvic/Illustration

WILMINGTON, Del., Sept 9 (Reuters) – Elon Musk contended that Twitter Inc’s (TWTR.N) resolution to pay hundreds of thousands of {dollars} to a whistleblower it had fired provides the world’s richest particular person one other justification for terminating his $44 billion settlement to purchase the social media firm.

In a Friday letter to Twitter, attorneys for Musk stated Twitter’s failure to hunt his consent earlier than paying $7.75 million to Peiter Zatko and his attorneys violated the merger settlement, which restricted when Twitter may make such funds.

The cost, which included $7 million for Zatko, “can’t be cured,” and Musk is subsequently “not required” to finish the merger, the letter stated. A replica was filed with the U.S. Securities and Alternate Fee.

Twitter didn’t instantly reply to a request for remark.

It has stated it was dedicated to finishing the merger, which requires Musk to pay $54.20 per share for the San Francisco-based firm. Twitter shares closed Friday at $42.19.

Zatko, referred to as Mudge, had been Twitter’s prime safety government earlier than being fired in January.

He later advised regulators that Twitter misled them and the general public about its safety practices and the way it fights hackers and spam.

Legal professionals for Musk stated the severance cost was made beneath a June 28 separation settlement between Twitter and Zatko.

Musk, who additionally runs the electrical automotive firm Tesla Inc (TSLA.O), declared the merger void 10 days later, accusing Twitter of misrepresenting the prevalence of spam or bot accounts on its platform.

Twitter rejected Musk’s claims and sued him to carry him to the merger, claiming he had gotten chilly toes as geopolitical issues and rising inflation rattled markets.

Musk later countersued Twitter, and on Friday amended his case to include Zatko’s claims, courtroom information present.

A trial in Delaware Chancery Courtroom is scheduled to start on Oct. 17. learn extra

Reporting by Jonathan Stempel in New York and Tom Hals in Wilmington, Delaware; Enhancing by Marguerita Choy and Rosalba O’Brien

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