Elon Musk Presently Under Investigation by Federal Authorities, Twitter Informs Judge
Tesla and Spacex CEO Elon Musk is under federal investigation for his conduct in connection with the $44 billion acquisition of Twitter, according to a court filing by the social media giant. Twitter claims that “Through counsel, he has exchanged substantive correspondence with those authorities concerning their investigations.”
Federal Authorities Are Investigating Elon Musk, Says Twitter
Twitter revealed in a court filing released Thursday that Tesla CEO Elon Musk is under federal investigation in connection with his $44 billion bid to buy the social media platform.
In a letter dated Oct. 6, addressed to Judge Kathaleen St. Jude McCormick who oversees the company’s case against Musk, Twitter’s lawyers noted that they have been asking for the documents related to the investigation from Musk since July 22. The lawyers wrote:
Elon Musk is presently under investigation by federal authorities for his conduct in connection with the acquisition of Twitter. Through counsel, he has exchanged substantive correspondence with those authorities concerning their investigations.
While emphasizing that those documents “bear upon key issues in this litigation,” the lawyers stressed: “Twitter requested the production of those documents months ago. But with trial just 11 days away, [the] defendants have still not produced them.”
In their letter, Twitter’s lawyers also referred to a letter the Securities and Exchange Commission (SEC) allegedly sent Musk in June. According to Twitter, the SEC was seeking information related to a tweet Musk posted in May, indicating that the “deal cannot move forward” until the social media company provides him with more information about spam and fraud accounts on the platform.
The SEC also probed Twitter over the company’s method of identifying spam accounts. In a letter dated July 27, the SEC told Twitter: “We have completed our review of your filings. We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff.”
Musk originally agreed to buy Twitter in April for about $44 billion. However, he subsequently tried to back out of the deal, accusing Twitter of a material breach of the agreement. He officially terminated his offer to buy Twitter in July, claiming that the social media company had not been transparent about the number of bots and fake accounts on its platform. Musk outlined multiple reasons to end the deal.
Twitter subsequently sued the Tesla CEO to force him to close the deal. Musk countersued Twitter. The two sides were scheduled to go to trial in Delaware Chancery Court on Oct. 17.
However, last week Musk said he would purchase Twitter at the agreed-upon price of $54.20 a share. The court gave him until Oct. 28 to close the acquisition to avoid a trial. Musk said that the purchase of Twitter will accelerate the creation of “X, the everything app.”
What do you think about Elon Musk being investigated by federal authorities? Let us know in the comments section below.
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