Musk seeks documents from Jack Dorsey in fight over Twitter deal

Date:

WILMINGTON, Del., Aug. 22 (Reuters) – Billionaire entrepreneur Elon Musk asks for documents from Twitter Inc(TWTR.N) co-founder Jack Dorsey as Tesla and SpaceX CEO continues his legal battle to walk away from his $44 billion deal for the social media company, according to a court filing.

Dorsey, who resigned as CEO of Twitter in November and left the board in May, was asked for documents and communications about Musk’s April agreement to buy the company and spam accounts on the platform, according to a copy of the subpoena.

Dorsey, who is CEO of payment processing company Block Inc, did not immediately respond to a request for comment. Block was co-founded by Dorsey and changed its name from Square Inc(SQ.N) last year.

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Musk, the world’s richest person due to his stake in Tesla Inc, told Twitter in July that he would terminate the agreement to buy the company for $54.20 a share because he alleged Twitter had violated the deal contract. Twitter and Musk have since sued each other, with Twitter asking a judge of the Delaware Court of Chancery to order Musk to close the deal. A five-day trial begins on October 17.

The subpoena sought documents and communications about Twitter’s use of mDAU, a measure of active users on its platform. Musk has claimed that the company defrauded him by hiding the number of fake accounts in his legal records, which Musk said he valued the company.

Twitter denies Musk’s spam allegations.

Twitter CEO Jack Dorsey addresses students at an Indian Institute of Technology (IIT) town hall in New Delhi, India, Nov. 12, 2018. REUTERS/Anushree Fadnavis/

Musk also wanted documents and communications about alternative active user measures the company has considered and information about the use of mDAU in executive compensation and annual targets.

Twitter declined to comment.

Dorsey had supported Musk’s takeover bid for Twitter, as the two men agreed on the need for greater transparency to the algorithm and giving users more control over the content they see.

Dorsey has also tweeted that he believes Twitter is being held back by the advertising model, and Musk has said Twitter should rely more on subscription fees and services such as money transfers between users.

Musk and Dorsey held talks about Musk joining the Twitter board in March before Musk revealed he had acquired a 9.1% stake in Twitter. Musk accepted a board seat, but before starting his term, he changed course and offered to buy the company.

Shares of Twitter fell 2.5% to $42.89 in late Monday trading.

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Reporting by Tom Hals in Wilmington, Delaware; additional reporting by Katie Paul in San Francisco; Sheila Dang in Dallas; Editing by David Gregorio

Our Standards: The Thomson Reuters Trust Principles.

Tom Hals

Thomson Reuters

Award-winning reporter with over two decades of experience in international financial news in Asia and Europe.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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