Elon Musk Already Breached The Twitter Takeover Agreement? With His Stellar Record Of Following The Rules?
That was fast.
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Elon Musk’s agreement in principle to buy Twitter for $43B and turn it into an 8chan clone set conservative circles ablaze with hopes for — and I’m not making this up — Truth and Reconciliation commissions — to get to the bottom of why Twitter banned people for harassing other users and making up stuff about horse paste curing COVID. Certainly atrocities against the right-wing on par with the Rwandan genocide or South African apartheid. I can see now tearful statements from FedSoc bros sobbing that they couldn’t scroll Twitter for 72 hours just because they spent a week talking about hanging Mike Pence or something. Really moving stuff.
But as lawyers understand, deals don’t always close and there are a lot of moving parts between now and handing the keys over to the incomparable genius who promised to create a “free speech” utopia. Then he explained what that means:
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In other words…
Anyway, Raffi Melkonian of Wright Close & Barger performed a community service for prospective transactional lawyers by breaking down all the materiality stuff in the agreement in a number of Twitter threads.
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One provision of note:
And attaching this (you may click on this to embiggen):
Which became immediately relevant when Musk took to Twitter yesterday afternoon:
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So he described Twitter policy as “obviously incredibly inappropriate” and doing so specifically in the context of explicit criticism of Vijaya Gadde — Twitter’s chief legal officer and general counsel. Lawyers can play a lot of semantic games, but it’s hard to say this isn’t a broadside against the clause “so long as such Tweets do not disparage the Company or any of its Representatives.”
Now, why would he do this? The most likely answer is… well…
But let’s put aside the possibility that he’s got terminal poor judgment. Because another thing that went down yesterday was this from Bloomberg:
Ah.
It’s not entirely clear where Musk keeps all his money, but it’s speculated that he has a serious “eggs in one basket” problem and that the lion’s share of his wealth is locked up in the speculative bubble around Tesla. Investors running to jump off Musk’s self-driving ego train won’t rob him of the $43B he needs to complete the deal — but it might rob him of enough that he’s no longer so keen on buying a social media vanity project.
Could he be launching material breaches in order to scuttle the deal and allow him to save face by claiming the deal was killed by Twitter trying to squelch his oh-so-precious free speech right to disregard his contract?
Not to engage in the sort of conspiracy-theory mongering that could soon takeover Twitter, but… he did send that Tweet after the market closed yesterday.
Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.
