Tesla CEO and Owner of SpaceX Elon Musk is going to be investigated by federal authorities over his conduct in his $44 billion takeover deal for Twitter.
According to reports, While the filing said he was under investigation, it did not say what the exact focus of the probes was and which federal authorities are conducting them.
Twitter, which sued Musk in July to force him to close the deal, said attorneys for the Tesla CEO had claimed “investigative privilege” when refusing to hand over documents it had sought.
In late September, Elon Musk’s attorneys had provided a “privilege log” identifying documents to be withheld, Twitter said. The log referenced 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 game of ‘hide the ball’ must end,” the company said in the court filing.
The court filing, which asked Delaware judge Kathaleen McCormick to order Musk’s attorneys to provide the documents, was made on October 6 — the same day that McCormick paused litigation between the two sides after Musk reversed course and said he would proceed with the deal.
Alex Spiro, an attorney for Elon Musk, told media that Twitter’s court filing was a “misdirection” and asserted: “It is Twitter’s executives that are under federal investigation.”
Twitter declined to comment on Spiro’s statement. It also declined comment when asked by the media about its understanding of any investigation into Musk.
The SEC did not immediately respond to a request for comment and the FTC declined to comment.
A tech news site, reported in April that the FTC was scrutinizing whether Musk failed to comply with the antitrust reporting requirement relating to an investor’s intentions of being a passive or active shareholder.
Twitter said in June, however, that the takeover deal with Musk had cleared an antitrust waiting period for review by the FTC and US Justice Department. read more
McCormick has given Musk until October 28 to close the acquisition. If the deal does not get done by then, a trial date will be set for November.