Big setback for Elon Musk in Twitter Trial
Twitter Inc. can fast-track its lawsuit against billionaire Elon Musk over his canceled $44 billion buyout of the social media platform.
Delaware Chancery Court Chief Judge Kathaleen St. J. McCormick ruled Tuesday that a five-day trial should take place in October. The decision is an early victory for Twitter, in a case in which many legal experts have said Musk will be an underdog.
Lawyers for San Francisco-based Twitter had said they needed only four days to prove the world's richest person must honor his agreement and pay $54.20 a share for the company. Twitter filed suit last week, requesting a Sept. 19 start for the non-jury trial.
In Tuesday's hearing, held remotely to accommodate the judge's case of Covid, a lawyer for Twitter argued that Musk was “contractually obligated to use his best efforts to close deal.” Instead, he is “doing the exact opposite,” attorney William Savitt told the judge. “He's engaging in sabotage.”
‘Cloud of Uncertainty'
Under the buyout agreement, Musk is obligated to finalize the deal within two days of all the closing conditions being met, Savitt said. Those conditions will be met in early September, he said.
“Mr. Musk has no intention of keeping any of his promises,” the lawyer said.
The judge said that in asking for a February trial, Musk's lawyers “underestimate the ability of this court to quickly process” complex legal disputes over merger-and- acquisition cases.
The dispute over the teetering transaction is “creating a cloud of uncertainty” over Twitter that is harming the company, McCormick concluded after hearing arguments on whether the case should be fast-tracked.
Twitter shares jumped as much as 5.4% after the ruling. They were trading at $39.63, up 3.2%, at 1:56 p.m.
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