Elon Musk’s Twitter case could end in shock twist with tech guru potentially forced to buy platform – or be sent to JAIL
ELON Musk has pulled his $44billion dollar bid out from under Twitter but may be forced to see the deal through by a Delaware judge.
Legal experts believe that the court is likely to rule in the company’s favor – and Musk could face huge penalties, have his Tesla stock seized, or even be jailed if he fails to comply.
Court filings reveal Twitter’s executives and legal team believe Musk “knowingly, intentionally, willfully, and materially breached” their $44billion dollar agreement.
Musk’s legal team argued in a letter that Twitter failed to meet its “contractual obligations” to provide Musk with a complete picture of spam accounts on the site.
And legal experts say the billionaire’s argument is on shaky grounds – after all, Musk once pledged to “defeat the spam bots or die trying!” in a tweet.
An epic legal showdown will unfold in the Delaware Chancery Court and the richest man in the world is not a typical defendant.
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Musk has a history of unruliness in the boardroom, courtroom, and on Twitter.
Legal experts say that all options are on the table to get Musk to play ball if the court rules against him, including jail time.
Law professor Robert Miller told Business Insider that the Delaware Chancery Court has powers designed to reign in a person who is refusing court orders.
Miller said the court could appoint a “Special Master” to comply with court orders on Musk’s behalf.
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“The acts of a Special Master would, for all intents and purposes, be the acts of Elon Musk,” Miller said.
Miller also said the court could impose fines large enough to shake the richest man in the world.
“Could they fine Musk $100 million a day until he complied? Yes they could.”
Another avenue for the court is to go after Musk’s holdings in Tesla because the electric car company is also incorporated in Delaware.
Miller said the court would be within its rights to seize Musk’s Tesla stock and turn the assets over to Twitter as payment.
Although such a high, profile case has not happened before, Miller said the court would have ‘no problem reaching Musk’s Tesla stock”.
He added: “Al states and all courts have procedures whereby the winning litigant can ‘execute’ a judgment by moving against the loser’s assets.”
But the court’s ultimate trump card is the authority to send Musk to jail for contempt.
The Delaware Chancery Court is the apex of corporate law in the United States – and former University of Delaware professor Charles Elson says that the court didn’t earn its title by letting things slide.
“There’s no way in the world Delaware is going to lose its franchise as the premier corporate law jurisdiction where contracts are enforced because Elon doesn’t feel like doing it,” he told NDTV.
At the court, Judge Kathaleen McCormick is set to hear the case between Musk and Twitter and she has a record of deference toward the company being bought.
In 2021, McCormick forced the closure of an acquisition where the bidding party tried to pull the plug on the deal.
And that past ruling is a very bad sign for Musk.
Law professor Eric Talley told Reuters that McCormick is unlikely to be intimidated by Musk and his standing as the richest person in the world.
He said: “I would not be placing my bets on Chancellor McCormick suddenly becoming weak-kneed.”
Twitter notched its first win in the case when the judge approved their call for an expedited trial.
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Musk and Twitter will clash during a five-day trial this October – this news was made public, ironically, by the court’s Twitter account.
Musk has made his intentions to countersue Twitter known.