San Francisco investigates non-permitted X roof sign
The city of San Francisco Departement of Building Inspection opens an investigation into X headquarters, after it receives a complain about a giant flashing X that has been installed on the roof of the building without a permit. This comes after issues with the removal of the Twitter sign on the front of the building. The complaint noted that a city inspector was denied access to the building’s roof, where the X had been installed, with the company saying that the structure was a “temporary lighted sign for an event.” City spokesperson:
A building permit is required to make sure the sign is structurally sound and installed safely. Planning review and approval is also necessary for the installation of this sign. The city is opening a complaint and initiating an investigation.
Our HQ in San Francisco tonight pic.twitter.com/VQO2NoX9Tz
— Elon Musk (@elonmusk) July 29, 2023
Musk sues lawyers who represented Twitter against him
Arguing that the bill is too high, Musk sues the lawyers who represented Twitter (now “X Corp”) in its suit against him for trying to abandon his $44 billion takeover offer in 2022. (Filed in the Superior Court of California, the case is X Corp. v. Wachtell, Lipton, Rosen & Katz [CGC-23-607461].) Hoping to get back part of the $90 million Twitter paid Wachtell, Lipton, Rosen & Katz (WLRK), X Corp alleges that the law firm tried to “fundamentally alter its fee arrangement” toward the end of its representation of Twitter in order to get an “improper bonus payment in violation of its fiduciary and ethical obligations to its client.” The complaint says that the board had been surprised about the fees and alleges that the firm was “at the center of a spending spree” by Twitter’s departing executives. It says those executives:
ran up the tab at Twitter by, among other things, facilitating the improper payment of substantial gifts to preferred law firms like Wachtell on top of the firms’ full hourly billings by designating tens of millions of dollars in handouts to the firms as ‘success’ or ‘project’ fees.
Music publishers sue Twitter for $250m, citing Musk’s lax copyright stance
The National Music Publishers’ Association sues Twitter, on behalf of firms including Sony Music Publishing, BMG Rights Management and Universal Music Publishing Group, in a US federal court in Tennessee, for more than $250m over bulk copyright infringement, citing Elon Musk’s tweets to argue that the company has deliberately stopped enforcing the rules. The suit says Twitter has not paid for a blanket licence allowing its users to upload copyrighted material, unlike TikTok, Facebook, Instagram, YouTube and Snapchat. in 2023, The New York Times reported that talks had stalled over the $100m price tag and fallen apart since Musk bought the site. The suit names 17000 songs as having been infringed:
Twitter’s policies demonstrate that Twitter views itself, not the law, as the arbiter of what content is permitted on the Twitter platform. Despite claiming to take down tweets in response to an infringement notice within hours or minutes, Twitter routinely waits much longer before acting, if it acts at all. There are thousands of instances where Twitter waited 30 days or more to remove or disable access to the content identified.
According to the suit, Musk said copyright “goes absurdly far beyond protecting the original creator” and “overzealous” application of copyright laws “is a plague on humanity”. The plaintiffs:
This statement and others like it exert pressure on Twitter employees, including those in its trust and safety team, on issues relating to copyright and infringement
Senators ask Musk and Yaccarino about Twitter FTC violations
Four US senators send a letter to Musk and Yaccarino asking them whether the layoffs and resignations at Twitter have hindered its ability to comply with the company’s FTC obligations. The senators are examining Twitter’s privacy practices under Musk to determine whether consumer protection laws are being flouted. The letter – signed by Elizabeth Warren (D), Ron Wyden (D), Ed Markey (D), and Mazie Hirono (D) – cites Ella Irwin’s departure as the latest source of concern about Twitter’s compliance track record. It asks whether Twitter conducted a privacy and security assessment of Twitter Blue before rolling it out (according to its 2022 consent agreement, Twitter must perform such assessments “prior to implementing any new or modified product”) as well as whether the platform has maintained a comprehensive cybersecurity program to protect user data since Musk’s takeover. It also asks whether Twitter has met various reporting requirements, including obligations to report any significant data breaches to the authorities.
[P]ersonnel changes, firsthand accounts from employees, and hasty launch of new products raise questions about whether Twitter is able to comply with its obligations under the FTC consent decree.
Mr. Musk’s behavior reveals an apparent indifference towards Twitter’s longstanding legal obligations, which did not disappear when Mr. Musk took over the company.
Regardless of his personal wealth, Mr. Musk is not exempt from the law, and neither is the company he purchased. Twitter must meet the requirements it agreed to under the 2011 and 2022 FTC agreements.
The lawmakers want Twitter to respond by June 18.
Musk Twitter buyout suit dismissed
U.S. District Judge Charles Breyer in San Francisco dismisses a class-action lawsuit against Musk which accused him of cheating Twitter shareholders in the course of buying the company. (Heresniak v Musk et al, U.S. District Court, Northern District of California, No. 22-03074)
According to the judge, the plaintiff lacked standing to sue because he challenged “wrongs associated with” Musk’s buyout, not the fairness of the buyout itself. Further, the judge says the plaintiff failed to show harm from Musk’s belated disclosure of a 9.2% Twitter stake (which the suit said let him buy more shares at lower prices before the buyout was announced) or from the late closing of the deal. The judge also finds no proof that Musk helped Dorsey and Silver Lake private equity firm managing partner Egon Durban breach their fiduciary duties by favoring their own and Musk’s interests – letting Dorsey roll his Twitter shares into an equity stake in the new company merely reduced the amount Musk paid at closing, it did not “improperly divert” money from other shareholders.
Musk’s cost-cutting hurts Goldman Sachs
Musk’s “cost-cutting exercise” contributes to a rapid growth in delinquencies of commercial real estate loans for Goldman Sachs. After Musk’s attempt to avoid taking over Twitter, he began seeking ways to cut costs, which included not paying rent. Now, Twitter’s landlord, Columbia Property, is suing and defaulted on its loan from Goldman Sachs as a result. (Goldman Sachs was part of a group of banks that provided $1.7 billion in loans to Columbia Property. The loan was secured against seven office buildings in San Francisco and New York, two of which accommodate large Twitter offices.)
Crown Estate sues Twitter for London HQ back rent
Britain’s Crown Estate, an independent commercial business that manages the property portfolio belonging to the UK monarchy, issues court proceedings to Musk’s Twitter for rental arrears, in relation to an office space close to London’s Piccadilly Circus. In December, Musk stopped paying rent on all of Twitter’s office space around the world, including its headquarters, in a cost-cutting effort.
Twitter: Musk under federal investigation
In a court filing, Twitter says Musk is being investigated by federal authorities over his conduct in his $44 billion takeover deal for the company. The company does not say what the exact focus of the probes is, nor which federal authorities are conducting them. The court filing asks Musk’s attorneys to provide documents that are being withheld, which Musk’s attorney’s say contain ‘privileged’ information. Twitter:
This game of ‘hide the ball’ must end.
An attorney for Musk:
[Twitter’s court filing is a] misdirection. It is Twitter’s executives that are under federal investigation.
Musk claims Twitter made whistleblower destroy evidence
Musk’s lawyers accuse Twitter’s top two lawyers, Vijaya Gadde and Sean Edgett, and Chief Privacy Officer Damien Kieran, along with CEO Parag Agrawal, of seeking to cover up the violations of the legal settlements with government regulators by ordering the Twitter whistleblower, Peter Zatko, to destroy 10 handwritten notebooks and deleted 100 computer files.
Twitter’s attempt to buy Mr. Zatko’s silence failed, but Twitter achieved its secondary aim of ensuring Mr. Zatko’s corroborating evidence would never come to light. [The document-destruction order deprived Musk’s legal team of] critical corroborating evidence of Mr. Zatko’s allegations, which would support his account of key meetings and conversations relevant to this case.
Musk-Twitter trial stayed, deal must close Oct 28
Delaware Chancery Court Judge Kathaleen McCormick agrees to stay the Musk-Twitter trial, giving Musk until 5 pm on Oct. 28 to close the deal. Otherwise, she will set another trial date for next month. The proceedings had been set for Oct. 17. Twitter had argued that Musk should close the deal before the trial date.
This action is stayed until 5 p.m. on October 28, 2022, to permit the parties to close on the transaction. If the transaction does not close by 5 p.m. on October 28, 2022, the parties are instructed to contact me by email that evening to obtain November 2022 trial dates.
Twitter wants deal closed before trial date
Musk’s attorneys formally ask a judge to stay the trial, which is set to start Oct. 17. The Musk team say a close would be possible on or around Oct. 28. However, Twitter says Musk must close the deal before proceedings start on the 17th. Twitter;
At a minimum…Defendants should be arranging to close on Monday, October 10. But they aren’t. Instead, they refuse to commit to any closing date. They ask for an open ended out, at the expense of Twitter’s stockholders (who are owed $44 billion plus interest), all the while remaining free to change their minds again or to invent new grounds to avoid the contract. 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 [as Musk’s motion insisted] and should be brought to trial.
Musk’s lawyers:
Twitter will not take yes for an answer. Astonishingly, they have insisted on proceeding with this litigation, recklessly putting the deal at risk and gambling with their stockholders’ interests.
Twitter: Musk’s fake account claim ‘not supported’
During discovery for the upcoming trial, lawyers for Twitter say Musk’s review of Twitter’s accounts by his advisers do not back up his allegation that the number of fake users was “wildly higher” than 5% as he claimed when he said he was ending the Twitter takeover deal in July. Musk claimed Twitter had misled him, allowing him to walk away without penalty from the deal. The lawyer says that two documents created by the two data scientists employed by Musk estimated that the number of fake accounts on the platform at 5.3% and 11%.
None of these analyses so far as we can tell remotely supported what Mr. Musk told Twitter and told the world in the termination letter.
Twitter lawyers: Musk destroyed Andreessen evidence
Twitter’s lawyers have accused Musk of destruction of evidence, citing a screenshot of a conversation between Musk and venture capitalist Marc Andreessen on Signal, a messaging app that includes a feature that deletes messages after some time.
Musk deleted these messages because he anticipated litigation and he knew that they would undermine his counterclaims and defenses.
The same court filing also showed that Musk exchanged multiple text messages with Oracle Corporation co-founder Larry Ellison, starting May 12 through 12:20 a.m. on May 13, which was just hours before he announced that he was pausing his attempt to acquire the social media company.
Twitter’s legal team has complained that despite a subpeona, the Tesla CEO has not really provided the relevant text messages between Musk and Ellison.
Both Ellison and Andreessen have backed Musk’s attempt to acquire Twitter. Andreessen’s VC firm, Andreessen Horowitz, backed Musk with $400 million, while Ellison was one of 19 investors who committed a whopping $7.14 billion for the potential acquisition.
Direct Message class action suit
A proposed class action lawsuit claims that Twitter surreptitiously eavesdrops on its users’ private Direct Message communications. For example, if a user privately tells a follower through the service to check out a story on nytimes.com, providing a full URL, Twitter will modify this into a custom link such as “http:/t.co/CL2SKBxr1s” (while still displaying the text “www.nytimes.com” to its users). The lawsuit says that by sending users to Twitter’s analytics servers before passing them on to the linked-to website, Twitter is benefiting by demonstrating to The New York Times and others where the source of the traffic is.
The end result is that Twitter can negotiate better advertising rates.
The claimed damages are as high as $100 per day for each Twitter user whose privacy was violated