A Delaware court has denied billionaire Elon Musk's request to postpone the October trial over his botched purchase of Twitter, but it has allowed him to use Peiter "Mudge" Zatko's allegations in his defence.
The choice was made at a hearing yesterday afternoon where Musk's lawyers argued for a "meagre" few weeks to review fresh evidence before the trial's scheduled start date of October 17. Twitter, on the other hand, said that at one point its lawyers had been compelled to stop responding to requests from foreign law enforcement, accusing Musk of attempting to prolong the trial and "sow havoc" with more document requests.
Twitter's arguments were overruled by Chancellor Kathaleen St. Jude McCormick, who stated that Musk should be given broad latitude to alter claims before the trial begins. However, she added that she was "reticent to say more concerning the merits of the counterclaims" before the lawsuit was filed. Musk and Twitter will discuss the "limited" discovery of additional documents pertaining to Zatko's charges, which include a number of complaints about Twitter's subpar management as well as claims that executives misled the public about the amount of bots using the network.
McCormick countered that Twitter would suffer undue injury from a trial delay; Musk had previously urged for the trial to be set for next year. “The company has been forced for months to manage under the constrains of a repudiated merger agreement,” wrote McCormick. “I am convinced that even four weeks’ delay would risk further harm to Twitter too great to justify.”
The ruling is consistent with McCormick’s earlier push for a fast trial, but the decision to allow the whistleblower’s claims strengthens Musk’s case — albeit in ways that aren’t necessarily fatal to Twitter. Musk initially said he suspended the deal because he’d discovered a far larger number of bots on the platform than he expected, but at the trial, he’s likely to argue that Twitter concealed “material adverse effects” potentially beyond the scope of bots, thanks to Zatko’s disclosures.
Meanwhile, Twitter has subpoenaed a wide range of Musk allies and argued that Musk got cold feet that have nothing to do with bots. At the hearing, it pointed to a text message urging his banker to “slow down” the deal for a few days while evaluating a speech by Russian President Vladimir Putin; “it won’t make sense to buy Twitter if we’re heading into World War III,” he said. The two sides will likely continue arguing over exactly what information they’ll need to hand over — but thanks to today’s decision, we won’t be waiting long to see it.