Whistleblower: Bad News For Twitter, Good News For Musk?

Elon Musk might have just gotten a leg up in his effort to back out of buying Twitter.

The billionaire Tesla CEO has spent months alleging that the company he agreed to buy for $44 billion undercounted its fake and spam accounts � and that he shouldn�t have to consummate the deal as a result.

Now, a whistleblower complaint from Twitter�s former security chief alleging the company misled regulators about its privacy and security protections � and its ability to detect and root out fake accounts � might play into Musk�s hands in an upcoming trial scheduled for Oct. 17 in Delaware.

Musk�s legal team, in fact, has already issued a subpoena for the whistleblower, Peiter Zatko � also known by his hacker handle �Mudge� � who served as Twitter�s head of security until he was fired early this year.

Alex Spiro, a lawyer representing Musk in his efforts to back out of buying Twitter, said the legal team �found his exit and that of other key employees curious in light of what we have been finding.�

Disclosure of the Mudge document changes the dynamic of the Twitter lawsuit from what appeared to be an easy win for Twitter, Wedbush analyst Dan Ives said in an interview.

�For Musk, it�s almost like a kid waking up on Christmas morning and seeing this under the tree,� he said. �It gives the Musk camp a leg to stand on going into the court battle.�

The whistleblower complaint boosts Musk�s claims on the spam bot issue, and will bring more focus on it in Washington, Ives said. �For Twitter�s board, it�s their worst nightmare that this came out at such a critical juncture.�

But Ives called the timing of the complaint �extremely interesting� just weeks before the trial in Delaware.

Twitter called the complaint �a false narrative� about the company and its privacy and data security practices �that is riddled with inconsistencies and inaccuracies and lacks important context.�

In an emailed statement, the company said Zatko�s �allegations and opportunistic timing appear designed to capture attention and inflict harm on Twitter, its customers and its shareholders.�

Some experts, though, see the whistleblower disclosure as little more than good optics for Musk.

While getting a lot of headlines, it probably won�t change what�s likely to be a Twitter victory in its lawsuit demanding that Musk go through with the purchase, said Erik Gordon, a University of Michigan law and business professor.

(AP)

Leave a Reply

Popular Posts