WILmington, Dell, Oct 13 (Reuters) – Federal authorities are investigating Elon Musk over his conduct in a $44 billion acquisition of Twitter. (TWTR.N)The social media company said in a court filing released Thursday.
While the file said it was under investigation, it did not say what the exact focus of the investigations and what federal authorities are conducting.
Tesla’s lawyers said Twitter, which sued Musk in July to force him to terminate the deal (TSLA.O) The CEO claimed “the privilege of investigation” when he refused to hand over the documents he requested.
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In late September, Musk’s lawyers filed a “record of privileges” to determine which documents should be withheld, Twitter said. The registry noted drafts of a May 13 email to the US Securities and Exchange Commission (SEC) and a slide presentation to the Federal Trade Commission (FTC).
“This ‘hide the ball’ game must end,” the company said in the court filing.
The court filing, which asked Delaware District Judge Catalyn McCormick to order Musk’s attorney to produce the documents, was filed on October 6 — the same day McCormick halted litigation between the two sides after Musk reversed course and said he would go ahead with the deal.
Alex Spiro, Musk’s attorney, told Reuters that bringing Twitter to court was a “misdirection” and asserted, “It’s Twitter executives who are the subject of a federal investigation.”
Twitter declined to comment on Spiro’s statement. She also declined to comment when asked by Reuters about her understanding of any investigation into Musk.
The Securities and Exchange Commission did not immediately respond to a request for comment and the Federal Trade Commission declined to comment.
The Securities and Exchange Commission has questioned Musk’s comments about the Twitter acquisition, including whether the 9% stake he built before announcing his offer was recently disclosed and why it indicated he intended to be a passive shareholder. Musk later re-disclosed to indicate that he is an active investor.
In June, the Securities and Exchange Commission asked Musk in a letter whether he should amend his public filing to reflect his intent to suspend or abandon the deal.
The Information, a tech news site, reported in April that the Federal Trade Commission was looking into whether Musk had failed to comply with antitrust reporting requirements regarding an investor’s intentions to be a passive or active shareholder.
However, Twitter said in June that the acquisition deal with Musk had cleared an antitrust waiting period for review by the Federal Trade Commission and the US Department of Justice. Read more
McCormick gave Musk until Oct. 28 to close the acquisition. If the deal is not implemented by then, a trial date will be set in November.
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Additional reporting by Tom Hales in Wilmington, Delaware, Sheila Dang in Dallas, Hyunjoo Jin in San Francisco; Editing by Peter Henderson and Edwina Gibbs
Our criteria: Thomson Reuters Trust Principles.
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