So Alex first of all what are we expecting to hear from Peter's at Coe on
Capitol Hill tomorrow. Yeah.
So I think that the hearing tomorrow will probably follow two lanes of
conversation. There'll be questions around the data
privacy concerns around the the bots and fake accounts that Zach Coe has alleged
that the company either ignored or didn't disclose.
But I also expect the Senate Judiciary Committee to focus on some more of the
data privacy issues that legislators care about that might be a little less
relevant to the acquisition but increasingly relevant as D.C.
has been able to push their antitrust legislation but has not gotten a lot of
traction on data privacy. So they might take this opportunity to
lean into some of those themes as well. Now Jeff Elon Musk is trying to use new
information that Twitter signed it 7 million dollar separation agreement with
Peter Zach Coe back in June. Musk trying to use that as a reason to
cancel the deal. What exactly is he trying to say here.
Well he's basically saying that that payment constituted something outside
the ordinary course of business. When you have these buyout agreements
going on one of the provisions that's often in there says that the seller has
to continue to run the business in the ordinary course.
Mr. much contention is this seven million
dollar severance payment was somehow tied to silencing Mr.
Zak so that he would not bring forth his his complaints publicly.
So that that he claims is another reason that there's been a material adverse
event. And he should be able to cancel the
deal. It does sound like a lot of money 7
million dollars to get this guy to go away.
Alex. And then he ends up you know blowing the
whistle anyway. Can you tell us a little bit more about
what happened here between DAX and Twitter.
Yeah Emily the sticker shock that you're having might be some of the reason why
Musk feels like he can lean into this as an argument that this type of settlement
should have been brought to his camp and it's outside the regular course of
business. So this was a guy who is an executive on
the security side was brought in a number of years back and oversaw a lot
of the important kind of security pieces and the teams that worked on those
things internally at Twitter. So he is a person who you know claims
that he has the kind of insider knowledge on this.
The company says well look you could have actually made some changes on these
things. So there is an interesting kind of back
and forth here. Emily I will point out it has been
reported that in that settlement agreement he was still allowed to blow
the whistle to government. To the government.
If there were any issues. So seven million dollars definitely
sticker shock. Definitely.
That kind of third strike that you on is claiming allows him to go out of the
deal. But it did leave that door open for us
to hear from Peter Zuko tomorrow morning.
Now Jeff has a judge weighed in on this latest request from Moscow and this
latest information about the separation agreement.
And if not what are we going to hear from her.
Well the judge has allowed Mr. Musk to amend his counterclaims in the
case to add the whistleblower's allegations.
I want to point out that the seven million dollar payment may be
contractual. We do not know if this was per a
severance agreement with Mr. Zak.
So I wouldn't automatically recoil at the 7 million dollar number.
We still need to find out what that's all about.
I doubt we're going to learn that tomorrow either.
So how are you expecting this testimony from Zach Coe tomorrow to be folded into
the case. That of course is building up to this
trial coming up in mid-October. Jeff here's his testimony tomorrow about
the national security staff and potential spies within Twitter's
employee group. Are the things that the senators are
going to be focusing on. The folks that we're concerned about is
going to be his is allegation that he raised the question about how many spam
and robotic counts were embedded within the customer base and the Twitter his
colleagues lack of interest in finding that out.
That's the key question in the trial coming up because that's where Mr.
Musk has put all his chips in terms of defense arguments.
Well clearly both parties could be watching this this testimony with bated
breath. Alex any word from Twitter about the
latest salvo or how any of this potentially changes their plans.
So they basically came out and said look we don't buy the argument that the
separation agreement is a viable excuse. I know that the Twitter camp will also
be watching this very closely as well. A lot of the shareholders who are
potentially making their voices heard in the shareholder vote tomorrow I would
think if things go really far down the line of privacy concerns.
If there's a lot of kind of interest in the data security piece that are
unrelated to the acquisition that would just be another thing to add to the list
of Twitter CEOs kind of big ticket items to care about.
Twitter has not been brought into D.C. as often as a lot of the larger social
media peers. So I think internally you could argue
there's a lot of distractions going on at the company right now.
And if they do get some traction in terms of legislators arguments that data
privacy should be more important then. Emily I would add that to the list of
kind of some of these ancillary concerns that are outside of just operating the
business.