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Musk countersuit claims Twitter schemed to mislead investors about the company

Tesla founder and CEO Elon Musk's countersuit against Twitter alleges Twitter misled him about the number of "monetizeable daily active users" leading to Musk withdrawing his $44 billion offer to buy Twitter. Photo courtesy of Tesla
Tesla founder and CEO Elon Musk's countersuit against Twitter alleges Twitter misled him about the number of "monetizeable daily active users" leading to Musk withdrawing his $44 billion offer to buy Twitter. Photo courtesy of Tesla

Aug. 5 (UPI) -- A countersuit against Twitter from Elon Musk accuses Twitter of misleading him about Twitter's true advertising base, leading Musk to try to get out of his $44 billion offer to buy Twitter.

Musk's lawsuit claims Twitter "was miscounting the number of false and spam accounts on its platform, as part of its scheme to mislead investors about the company's prospects by focusing on its purported hundreds of millions of mDAU (monetizeable daily active users)."

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Musk said in his lawsuit that Twitter has repeatedly touted monetizeable daily users as a key metric for revenue growth but that "is not as closely tied to revenue as Twitter leads the public to believe."

"Twitter played a months-long game of hide-and-seek to attempt to run out the clock before the Musk Parties could discern the truth about these representations, which they needed to close," Musk's lawsuit said. "The more Twitter evaded even simple inquiries, the more the Musk Parties grew to suspect that Twitter had misled them."

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Twitter Thursday subpoenaed several investment banks and venture capital firms in Musk's circle as the legal battle over Musk's attempt to retract his offer to buy Twitter intensifies.

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In its lawsuit trying to force Musk to consummate the purchase deal, Twitter said Musk's information requests from the start "were designed to try to tank the deal."

Musk's lawsuit alleges that while Twitter claims to have 238 million monetizeable daily users, those who actually see ads is about 65 million lower than what Twitter represents.

A Delaware judge has scheduled the civil trial to hear the Twitter-Musk case for Oct. 17.

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