Yeah, like the alleged Section 4.5, 4.6, and 4.8 violations.
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Elon & Twitter
- Thread starter Buckminster
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Daniel in SD
(supervised)
disobey illegal government order = MAE
obey illegal government order = MAE.
It's all bad. Personally I think if they're going to do business in India they should just create a completely independent version of Twitter.
Knightshade
Well-Known Member
To be fair most of the alleged "section x" violations in the original claim...pretty clearly weren't....
Like where he claimed they violated the info covenant because they stopping giving him additional info nothing in the merger actually gave him the right to even ask for.
I'm not referring to the original claim...To be fair most of the alleged "section x" violations in the original claim...pretty clearly weren't....
Like where he claimed they violated the info covenant because they stopping giving him additional info nothing in the merger actually gave him the right to even ask for.
EVNow
Well-Known Member
illegal government order ? I've not followed it closely - but I don't think its an illegal order as such. Probably constitutionality will be challenged .... not sure.
Either way - those two are very different. I think the first one is similar to how Apple refused the order from FBI to unlock the phone of the San Bernardino attacker. I think filing a case is a legal thing to do against an order you may consider not legal.
But allowing spies is clearly illegal and just succumbing to political pressure. Its never a good look.
I think they should threaten to leave India if government puts illegal pressure. Make it quite explicit and broadly publicize it. Also involve the US embassy.
BTW, WhatsApp has also sued Indian government over the controversial law.
/cloudfront-us-east-2.images.arcpublishing.com/reuters/CSHSSS4FEBME5KI7VE3OGWQ57U.jpg)
WhatsApp sues Indian government over new privacy rules - sources
WhatsApp has filed a lawsuit in Delhi against the Indian government seeking to block regulations coming into force on Wednesday that experts say would compel Facebook's (FB.O) messaging app to break privacy protections, sources said.
www.reuters.com
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he doesn’t see it as his property, he woke up and now sees it as a trap he sprung on himself and has to wiggle out of.
Knightshade
Well-Known Member
Ok, but so far we have to assume the new "they violated sections X Y and Z" claims aren't any more accurate or rising to MAE level than the original ones.
Levine has a bit on this today and essentially is saying absent the Elon deal, even if Mudges claims are maximally true, the impact to Twitter would be hard to paint as an MAE.... but ironically it might cost twitter shareholders vastly more than it otherwise would if it ends in either no merger, or a significantly cheaper merger-- compared to what the likely top end of any fines or penalties would be (if any at all) for their actual worst everything-claimed-is-true behavior.
Of course if the judge looks at it and reaches a similar conclusion-- that while this might be A Thing, it's not an MAE- she'd just deny Musks amended complaint and proceed to the merits (or lack thereof) of his original suit.
Daniel in SD
(supervised)
Clearly Twitter and WhatsApp think it is an illegal order. I'm not an expert in Indian law so I can't say.illegal government order ? I've not followed it closely - but I don't think its an illegal order as such. Probably constitutionality will be challenged .... not sure.
Either way - those two are very different. I think the first one is similar to how Apple refused the order from FBI to unlock the phone of the bomber. I think filing a case is a legal thing to do against an order you may consider not legal.
But allowing spies is clearly illegal and just succumbing to political pressure. Its never a good look.
I think they should threaten to leave India if government puts illegal pressure. Make it quite explicit and broadly publicize it. Also involve the US embassy.
BTW, WhatsApp has also sued Indian government over the controversial law.
WhatsApp sues Indian government over new privacy rules - sources
WhatsApp has filed a lawsuit in Delhi against the Indian government seeking to block regulations coming into force on Wednesday that experts say would compel Facebook's (FB.O) messaging app to break privacy protections, sources said.
I have no idea if knowingly hiring government agents is illegal but I'm against it. I'm also unclear whether these employees are located in India or the US. I haven't seen anyone cite what law Twitter violated.
EVNow
Well-Known Member
Well, such a law was always going to be challenged. BTW, you are using "order" and "law" to mean the same thing. I don't think the "order" was illegal - but the law might be struck down (or more likely constraints placed) as too broad and in violation of privacy laws.
That I'm fairly sure of. Because it violates privacy and freedom of expression - both part of the constitution (and innumerable past cases).
If Twitter violated the terms and assertions of the merger agreement, why would an MAE even need to be in play? Doesn't it revert to pure contract law?
Daniel in SD
(supervised)
I think it has to be an MAE. For example from section 4.5 which you cited as Twitter possibly being in violation of:
"Neither the Company nor any of its Subsidiaries is in default or violation of any Law applicable to the Company, any of its Subsidiaries or by which any of their respective properties or assets are bound, except for any such defaults or violations that would not have a Company Material Adverse Effect."
If deals could be cancelled for any violation of the law, no matter how small, then you'd always be giving the buyer an opt out. I challenge you to find a large company that hasn't done something illegal in the last year.
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Daniel in SD
(supervised)
The order was to remove content, how does that not violate freedom of expression?
I guess I think that an order authorized by an unconstitutional law is illegal. Seems sort of like semantics but I'm no lawyer.
AlanSubie4Life
Efficiency Obsessed Member
The analysis above says (as far as I can tell) if it meets the standard of materiality (not MAE), any fraudulent statement in the merger agreement would give Elon an out. If it isn’t in the merger agreement then the fraud “out” isn’t an option of course.
Additionally, the standard is:
“The common law rule is, if Musk can show that Twitter made a false statement, on which he relied, and that Twitter intended to defraud him, Musk can rescind the contract.”
So anyway, no idea if there is a way to have this whistleblower discovery convert a Twitter representation in the MA into an intentional fraudulent statement.
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Sure, for 4.5 where the letter calls out "These violations would have material, if not existential, consequences to Twitter’s business, constituting a Company Material Adverse Effect as defined in the Merger Agreement." 4.14 might also yield an MAE.
4.6 and 4.8 do not appear so encumbered.
Daniel in SD
(supervised)
Yep, if there's fraud against Elon then he can out of the deal. Obviously that will be extraordinarily difficult to prove.
Daniel in SD
(supervised)
Still has to be "material" though.
I'm wondering if this article VII (conditions to the merger) makes an MAE a requirement to terminate:
"(b) (i) each of the representations and warranties of the Company contained in this Agreement (except for the representations and warranties contained in Section 4.2(a) and Section 4.2(b)), without giving effect to any materiality or “Company Material Adverse Effect” qualifications therein, shall be true and correct as of the Closing Date (except to the extent such representations and warranties are expressly made as of a specific date, in which case such representations and warranties shall be so true and correct as of such specific date only), except for such failures to be true and correct as would not have a Company Material Adverse Effect; and (ii) each of the representations and warranties contained in Section 4.2(a) and Section 4.2(b) shall be shall be true and correct in all material respects as of the Closing Date (except to the extent such representations and warranties are expressly made as of a specific date, in which case such representations and warranties shall be so true and correct in all material respects as of such specific date only);"
Daniel in SD
(supervised)
The whistleblower hasn't said anything about Twitter's intent to defraud Musk yet. Musk would also have to prove that he relied on those false statements made with that intent. It seems to me like Elon just decided to buy Twitter on a whim! Twitter is of course trying to prove that by subpoenaing everyone Elon talked to in the last six months.
bkp_duke
Well-Known Member
Daniel in SD
(supervised)
Twitter is a sophisticated, extraordinarily competent criminal enterprise, the fraud against Musk could have started long before then. It was a long con
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