Elon Musk’s lawyer presented a letter to Twitter on Monday accusing the company of refusing to provide active user data reports that Musk previously requested.
Musk’s lawyer Mike Ringler claimed Musk made repeated requests for data insight into the number of spam accounts, accusing Twitter of falling short of the requirements of the merger agreement. Twitter’s most recent correspondence with the Tesla and SpaceX CEO only offered to give additional details on their preexisting testing methodologies — testing Musk does not believe to be “adequate,” according to the letter.
“At this point, Mr. Musk believes Twitter is transparently refusing to comply with its obligations under the merger agreement, which is causing further suspicion that the company is withholding the requested data due to concern for what Mr. Musk’s own analysis of that data will uncover,” Ringler stated, according to the letter.
Previous reports from Twitter have the number of fake accounts to be less than 5%. Musk has suggested that number could actually be four times higher. If the number of fake accounts is as high as Musk predicts, advertisers could demand lower fees due to the way fake accounts skew data, thus reducing the value of Musk’s buyout deal.
20% fake/spam accounts, while 4 times what Twitter claims, could be *much* higher.
My offer was based on Twitter’s SEC filings being accurate.
Yesterday, Twitter’s CEO publicly refused to show proof of <5%.
This deal cannot move forward until he does.
— Elon Musk (@elonmusk) May 17, 2022
Twitter said in a quarterly filing on May 2 that its “estimation of false or spam accounts may not accurately represent the actual number.” (RELATED: SpaceX Has Launched So Many Satellites Astronomers Can’t Do Their Jobs)
Musk’s letter also addressed his right to the data.
“As Twitter’s prospective owner, Mr. Musk is clearly entitled to the requested data to enable him to prepare for transitioning Twitter’s business to his ownership and to facilitate his transaction financing. To do both, he must have a complete and accurate understanding of the very core of Twitter’s business model,” the letter stated.
The letter casts doubt on the success of the $44 billion deal. The deal has had several setbacks, going back to the lawsuit filed in April by a Twitter shareholder for failing to disclose his massive purchase of the company shares.