Image source: The Epoch Times
On Thursday, the judge in charge of the takeover dispute between Twitter and Elon Musk decided to stay the proceedings until October 28.
The pause comes at the request of Musk, pushing the Oct. 17 process further.
The delay
Twitter initially rejected Musk’s request to put the deal on hold, citing concerns the Tesla CEO would break his promise to close the deal quickly.
Delaware Chancery Court chancellor Kathaleen St. Judge McCormick said:
“If the transaction does not close by 5 pm on October 28, 2022, the parties are instructed to contact by email that evening to obtain November 2022 trial dates.”
On Thursday, Elon Musk’s attorneys filed a motion to suspend legal proceedings in his Twitter dispute.
They also filed a request to remove the October 17 trial from the court’s agenda.
Musk’s lawyers noted that the changed circumstances made the action moot.
Read also: A new letter reveals Elon Musk intends to buy Twitter again
The letter
The filing comes after Musk this week proposed proceedings to take over Twitter on its original terms after months of trying to get out of the deal.
It says Tesla’s CEO is willing to close the transactions for $54.20, and the debt financing parties are working together to fund the closure and close it around October 28.
The filing also mentions Twitter’s opposition to the halt of the legal process.
“Twitter will not take yes for an answer,” the letter said.
“Astonishingly, they have insisted on proceeding with this litigation.”
Twitter’s attorney issued a harsh response to Musk’s filing, writing:
“The obstacle to terminating this litigation is not, as Defendants say, that Twitter is unwilling to take yes for an answer.”
“The obstacle is that Defendants still refuse to accept their contractual obligations.”
The letter also notes that Musk has spent months trying to end the deal, and as the trial draws closer, “Defendants declare they intend to close after all.”
“‘Trust us,’ they say, ‘We mean it this time,’” the letter continued.
“Until Defendants commit to close as required, Twitter is entitled to its day in Court.”
“Defendants can and should close next week. Until they do, this action is not moot and should be brought to trial.”
The filing
The exchange between Twitter and Elon Musk suggests the Tesla CEO’s funding is central to the argument to drop the lawsuit and complete the deal.
Musk previously said he would pay for the company through debt commitments to financial institutions, equity financing from investors and his own wealth.
Legal experts have expressed concern that lenders are looking to get out of business amid recent changes in the debt market and the falling value of social media companies.
Experts say Twitter likely wants the litigation to continue to pressure Musk unless he agrees to complete the deal with or without debt financing.
In Thursday’s filing, Musk’s legal delay said the company resisted a stay due to concerns that he made his offer to enter into the deal conditional on securing debt financing and that payment could fail.
“Counsel for the debt financing parties has advised that each of their clients is prepared to honor its obligation,” Musk’s filing reads.
Musk’s filing asked the court to adjourn the proceedings and order Twitter to complete the settlement.
“Proceeding toward trial is not only an enormous waste of party and judicial resources, it will undermine the ability of the parties to close the transaction,” the filing reads.
“Instead of allowing the parties to turn their focus to securing the Debt Financing necessary to consummate the transaction and preparing for a transaction of the business, the parties will instead remain distracted by completing discovery and an unnecessary trial.”
Twitter lawyers said Musk’s team declined to commit to a closing date.
Their letter also said that a representative from one of the banks that would provide loans to Musk said Thursday morning that they had not yet sent them a loan notice.
Tesla’s CEO didn’t tell them he intended to close the deal within a specific timeframe.
Read also: Peiter Zatko’s Twitter allegations prompts executives to hold a meeting
Deposition
Earlier on Thursday, Musk’s and Twitter’s attorneys agreed to suspend Tesla’s CEO’s statement in the lawsuit.
Musk’s statement was supposed to start on Thursday.
While it’s unclear if there’s a new date for Musk’s impeachment, Twitter may be pushing to finalize it early next week if a deal isn’t reached.
Delaware Chancery Court Chancellor Kathaleen St. Jude McCormic said in a court filing Wednesday that neither party had filed for suspension of the proceedings.
She said she continued to prepare for the trial, which was due to start on October 17th.
On Thursday, McCormick filed a letter to both parties setting deadlines for responding to interrogatories, noting that the trial is approaching.
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