Twitter Wants To Investigate Why Elon Musk Cancels Deal, Important Partner Becomes Witness!

Elon Musk continues to be chased by Twitter (Photo: twitter @elonmusk)

JAKARTA - Twitter Inc is trying to find evidence that Elon Musk tried to thwart the deal to take over the social media platform worth US$44 billion (Rp659 trillion). Twitter is also investigating the motivations for the world's richest conglomerate to withdraw from the deal.

Twitter sent dozens of civil subpoenas this week to global banks such as the Morgan Stanley unit, co-investors in the deal including affiliate Brookfield Asset Management Inc, and Musk's advisers, according to their lawsuits over the past two days in the Delaware Court of Chancery.

Morgan Stanley declined to comment on the report. Brookfield did not immediately respond to a request for comment. Representatives for Musk and Twitter also could not be reached by the media about this.

The subpoena seeks documents and communications regarding the deal, its financing, any information about "bot" or fake Twitter accounts. They are also looking into any information recipients might have about the potential impact on the deal from a change in the share price of electric car manufacturer Tesla Inc, of which Musk is chief executive.

The subpoena is part of Twitter's lawsuit against Musk seeking to hold him to a $54.20 per share deal he has agreed to. The five-day trial is scheduled to begin October 17 at Delaware Chancery Court.

Experts say the subpoena shows Twitter wants to know what lenders, investors and advisers have to say about Musk's behavior after he signed the deal in late April.

"They suspect that behind the scenes he conspired to blow it all up," said Minor Myers, a professor at the UConn School of Law.

Musk said on July 8 that he was pulling out of the deal because Twitter allegedly violated the agreement by withholding data about fake accounts on the platform. While Twitter says fake accounts are a distraction from the only issue that matters, namely the terms of the agreement.

Musk also said he was leaving because Twitter fired high-ranking executives and a third of its talent acquisition team, violating Twitter's obligation to "substantially preserve the material components of its current business organization."

According to legal experts, Musk cannot be found guilty or defeated and ordered to close the deal with Twitter, if the financing fails, provided he is not the cause of the funding failure.

Twitter's subpoena focuses on what they say is the firing of Bob Swan, an operating partner at venture capital firm Andreessen Horowitz, who initially led Musk's efforts to finalize financing the deal. He was replaced by Antonio Gracias, a longtime partner of Musk, according to the Twitter lawsuit.

Brian Quinn, a professor at Boston College Law School, said Twitter appeared to want to know if "Gracias had a role in finalizing the financing or if he should have slowed things down."

Swan did not immediately respond to messages sent via LinkedIn and Andreeesen Horowitz. Gracias did not respond to a request for comment sent to his firm Valor Equity Partners.

Experts say Twitter would be interested in understanding lenders' concerns about the number of fake accounts on the platform, and whether that's a problem for them as Musk suggested.

Investors were asked to communicate about the Twitter deal with those close to Musk, such as Steve Jurvetson, a former Tesla board member and current director of SpaceX, the private rocket company founded and headed by Musk.

Jurvetson did not immediately respond to a request for comment sent to his Future Ventures firm.

"lol, lawyers with TWTR sent subpoenas to friends in the ecosystem around @elonmusk," wrote Joe Lonsdale, co-founder of Palantir Technologies Inc (PLTR.N), on Twitter. "I had nothing to do with this apart from some cynical comments, but got a 'YOU ORDERED' document notification," he wrote.

He called the Twitter subpoena an "abusive giant fishing expedition." Lonsdale did not immediately respond to a request for comment sent to his 8VC firm.

Theodore Kittila, a Delaware corporate litigator, said Twitter was trying to determine what Musk said privately when he tweeted publicly that he was concerned about bots and fake accounts on Twitter.

"They're trying to get up there, behind the tweets," Kittila said. "They looked at the emails and tried to guess what the actual conversation was and what prompted his decision to suspend the deal."

Musk has sent his own subpoenas over the past two days to Concentrix Solutions Corp, a data analytics firm, and TaskUs USA, which moderates the content. What question is Musk's subpoena filed under the seal?