Elon Musk can use whistleblower claims in his case against Twitter, judge rules

The billionaire, however, won't not be allowed to delay the trial over his attempt to walk away from his $44bn deal to acquire the social media platform

Twitter and Elon Musk have a trial scheduled for October 17. Reuters
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Elon Musk can use a whistleblower's claims in his legal case against Twitter but the billionaire cannot delay the trial over his attempt to walk away from his $44 billion deal for the company, a judge ruled on Wednesday.

"I am convinced that even four weeks’ delay would risk further harm to Twitter," wrote Chancellor Kathaleen McCormick of Delaware's Court of Chancery, in affirming the trial will start next month.

Shares of Twitter rose about 4 per cent in early Wednesday trading to $40.15.

“We are hopeful that winning the motion to amend takes us one step closer to the truth coming out in that courtroom," Alex Spiro, an attorney for Mr Musk, said in a statement.

Mr Musk's legal team argued on Tuesday that justice demanded delaying the five-day trial so Mr Musk could investigate claims by whistleblower Peiter Zatko, known as "Mudge", that Twitter hid weaknesses in its security and data privacy.

Mr Musk's initial case against Twitter claimed the company misrepresented the prevalence of spam or bot accounts on the platform.

Last month, Twitter's former head of security, Mr Zatko's allegations became public and provided Mr Musk, the world's richest person, fresh ammunition to bolster what legal experts said was a long-shot attempt to walk away without paying a $1bn termination fee.

“We look forward to presenting our case in court beginning on Oct. 17th and intend to close the transaction on the price and terms agreed upon with Mr Musk,” said a statement from Twitter spokesman.

Twitter and Mr Musk have sued each other. The company wants chancellor McCormick to order Mr Musk to buy the company for the $54.20 per share he agreed to in April.

Mr Musk, who is also chief executive of electric vehicle maker Tesla, initially countersued Twitter for misleading him about the amount of fake or bot accounts on the platform, which he said allowed him to walk away from the deal.

Updated: September 07, 2022, 6:46 PM