So, where does the Elon-Twitter saga go from here? Musk is still holding $13 billion of debt on this acquisition, which is why my partner Bill Cohan theorizes that Musk may be attempting to freak out bankers with questionable stewardship—purposely—so he can buy up the debt at a discount. Even so, what sort of liabilities can be tolerated as this story continues?
Ex-employees, as mentioned, are already suing him. Right behind them on this litigation train are jilted partners and stiffed vendors. And it goes on and on. As Elon fiddles with the moderation knobs, he may also stumble into legal hot zones like intellectual property and sex trafficking that stand outside of the shield that is Section 230, the ever-controversial digital law that ensures that sites like his aren’t treated as the publisher of user content. …
Musk may have bought his way out of problems with Twitter’s former shareholders with his $44 billion deal (although Musk faces a pending suit from those who allege his failure to timely disclose his stock purchases in early 2022 cost them money), but those who own a stake in Musk’s other company, Tesla, are increasingly upset over his diverted attention. Already, there are lawsuits, and more may follow.
Finally, if it’s really Musk’s plan to sabotage the platform just to buy back its debt on the cheap, we could see legal action from those very bankers who lent him a big hand in acquiring the platform in the first place.
[It’s a little soon for that kind of speculation. Right now, Musk is making Twitter more relevant and newsy, which he probably figures will bring higher engagement and thus better marketing options. Wait and see. — Ed]
Join the conversation as a VIP Member