The court may be particularly hesitant to order Musk to close the deal because it understands he might not comply, a seemingly preposterous notion that somehow carries weight. Carolyn Berger, the court’s former vice-chancellor, said this outright on CNBC Wednesday. “The problem with specific performance,” she said, “especially with Elon Musk, is that it’s unclear whether the order of the court would be obeyed.”
The court could fine Musk for noncompliance daily, Berger said, but the fines would simply pile up on a ledger and might not result in any action. So, a desire for a quick resolution might push the court to rule in favor of Twitter, but only levy damages, which lawyers familiar with the case believe are capped at $1 billion.
The possibility of not getting $44 billion via a specific performance order will loom over Twitter’s case and likely push it to settle. The Delaware court’s chancellor, Kathaleen McCormick, has forced mergers in the past, and has written that the court “has not hesitated to order specific performance.” But the risk of failing to get the specific performance order, and landing only $1 billion in damages, could make a settlement for more than $1 billion appealing for Twitter.
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