The Delaware Court of Chancery says Twitter can proceed with a limited probe to figure out whether whistleblower Peiter “Mudge” Zatko contacted billionaire Elon Musk’s lawyers before he backed out of the deal. The decision was released shortly before Musk reportedly asked to close the deal on its original terms.
Musk and Twitter contested how much information Twitter could seek about Zatko, who has alleged that Twitter concealed important information about its bot problem before Musk proposed acquiring it. Zatko revealed his claims publicly in August, and he’s denied contacting Musk or any of his representatives before that. But in court, Musk and Twitter have been fighting over an “unusual” email sent to Musk’s attorney Alex Spiro from an anonymous ProtonMail account on May 6th. The sender claimed to be “a former exec at Twitter leading teams directly involving Trust & Safety/Content Moderation” and offered Musk information on Twitter through alternate channels. Musk ultimately paused the deal in mid-May.
Musk’s team argued that Zatko’s testimony should make the email irrelevant, proposing Twitter be allowed a narrow search of mainly emails. Twitter has argued that it justifies a larger number of searches through a larger volume of information, including text messages and hard copy documents.
Judge Kathaleen McCormick agreed with Twitter that Zatko’s testimony hadn’t been assessed for credibility, and she said that Musk’s team’s statements raised questions — like whether they had investigated the sender’s identity. “The timing and contents of the May 6th email render it at least plausible that Zatko was the author,” writes McCormick. She approved a “middle ground” in which Twitter can request files from a limited number of people, but it can demand non-email communications and search up to 15 terms.
The decision might end up being moot because Musk has reportedly proposed buying Twitter on the original terms of the deal rather than continue fighting a lawsuit against Twitter — which is also seeking to make him buy the company. Late last week, the court published a trove of Musk’s text messages, and he was scheduled to sit for a delayed court deposition later this week.