August 25, 2022: -A whistleblower’s objection that Twitter deceived federal regulators regarding the company’s safety risks could provide Elon Musk with fresh ammunition in his bid to purchase the company for $44 billion.
Musk’s legal showdown with Twitter has centered around claims that the company misled the billionaire about the number of the bot and spam accounts on its forum.
The whistleblower complaint by Twitter’s former security chief Peiter Zatko shows Musk started to pursue his legal battles, such as shares that Twitter failed to expose weaknesses in its security and data privacy.
It is providing “a different basis for fraud,” said Ann Lipton, a professor at Tulane Law School.
It is unclear if and how Musk’s group will use the whistleblower’s information. However, Musk’s lawyer, Alex Spiro with Quinn Emanuel Urquhart & Sullivan, said that Zatko had issued a subpoena.
“We found his exit and that of dissimilar key employees curious in light of what we have been seeing,” Spiro said in a statement.
Legal experts added that the whistleblower complaint introduced uncertainty to Musk’s showdown with Twitter instead of dramatically transforming a point that corporate law specialists have said favors Twitter.
“Volatility is valuable if you’re not recreating a strong hand. It creates some possibility that something crazy might happen,” said Eric Talley, a Columbia Law School professor of the whistleblower complaint.
Twitter’s stock decreased about 5.9% in trading at $40.44 a share.