Elon Musk fights Twitter over disclosure of potentially confidential information
Elon Musk’s bid to release on Wednesday a counter-suit he filed against Twitter last week was dismissed by the judge overseeing the bombshell case late in the day.
Delaware Chancery Court Judge Kathaleen McCormick ruled that Musk’s counterclaims, response and affirmative defenses to the Twitter lawsuit would be made public by Friday afternoon, according to documents filed by the tribunal.
The decision gave Twitter a victory in the first of what will likely be many skirmishes after the social media site argued that releasing the documents could expose “confidential” business information, The Post has learned.
The feud centers on the 164-page countersuit Musk filed against Twitter last Friday. The lawsuit, which has been filed under seal and has not yet been seen by the public, represents an escalation in the battle over the Tesla CEO’s scrapped $44 billion deal to buy Twitter.
Companies are often allowed to redact elements of legal documents that could reveal confidential information about their business – and Twitter argued that it needed more time to see “what information in [Musk’s] documents filed, if any, to be designated as confidential.
Musk’s legal team claimed that Twitter engaged in a blocking tactic to preempt the story in the press. They said in their counter-filing on Wednesday that Twitter should file its response to Musk’s lawsuit by Thursday — and that Twitter’s response to Musk’s counter-suit could potentially be publicly available ahead of Musk’s counter-suit. Musk herself, unfairly giving the company a leg up in media coverage.
“Twitter should not be allowed to continue to bury the side of the story that it does not want to publicly disclose,” Musk’s attorney, Edward Micheletti, wrote in a letter to McCormick.
Micheletti added that Twitter was trying to circumvent court rules to “get their response alongside the defendants’ story to the public before the defendants’ story can be told.”
Musk’s side believes that Twitter should not seek any redactions from the countersuit because none of its content “meets the standard of sealing,” according to emails between the two parties released as exhibits on Wednesday.
Under court rules, Musk’s countersuit and Twitter’s response should be publicly available by Friday — potentially in redacted form.
Twitter shares closed up 0.1% at $41.00 on Wednesday.
The stock has risen about 26% since the company sued Musk on July 12 in an attempt to force him to honor its deal to buy Twitter for $54.20 per share, indicating investors are increasingly more optimistic about Twitter’s chances in the legal battle.
Ahead of the trial, which is due to open on October 17, Musk and Twitter both sent subpoenas in an effort to gather evidence to back up their cases.
Musk has sued Goldman Sachs and JPMorgan, two banks that advised Twitter on Musk’s takeover bid, the Financial Times reported on Wednesday.
Twitter, meanwhile, has subpoenaed several members of Musk’s Silicon Valley social circle, including elite tech investors Marc Andreessen, Chamath Palihapitiya, David Sacks, Steve Jurvetson, Jason Calacanis, Keith Rabois and Joe Lonsdale, The Washington Post reported Monday.
Lonsdale blasted Twitter’s subpoenas as a “giant harassing fishing expedition” in a tweet on Monday.
“I had nothing to do with it other than a few sarcastic comments, but I received a ‘YOU ARE HEREBY ORDERED’ document notice,” Lonsdale scolded.