Elon Musk Sues Twitter's Former Law Firm - He Noticed Where $90 Million Went Right Before He Bought Company
The kids had the new dad’s credit card and went to town on it.
Elon Musk’s X Corp. has filed a lawsuit against Wachtell, Lipton, Rosen & Katz, the law firm that represented Twitter during Musk’s attempt to take the company private, calling its actions “unconscionable,” Reuters reported.
The lawsuit, filed Wednesday in California Superior Court in San Francisco, claims that Wachtell charged an exorbitant fee for defeating Musk’s attempt to walk away from his $44 billion buyout of Twitter.
“Despite having previously agreed to work on an hourly fee basis and subsequently charging millions in hourly fees under that arrangement, Wachtell disregarded both California law and its ethical and fiduciary duties in the final days of its four-month Twitter engagement to improperly solicit an unspecified — but clearly gargantuan — success fee, as part of a $90 million ‘total’ fee,” the lawsuit says.
“The $90 million fee collected from Twitter for a few months of work on a single matter represented nearly 10% of Wachtell’s gross revenue in 2022, and over $1 million per Wachtell partner,” it says.
FRAUD: Former Twitter execs conspired to empty the company’s bank accounts after @elonmusk agreed to close the transaction. For example, in one scheme, execs gave the company’s lawyers a $90M bonus! Musk is suing to get the fraudulent bonus back. https://t.co/qlelCCYWvg
— @amuse (@amuse) July 7, 2023
“In this Complaint, Plaintiff respectfully does not seek any compensatory damages but rather seeks the equitable remedies of restitution, fee forfeiture, and disgorgement of legal fees,” the lawsuit says.
After initially agreeing to the acquisition, Musk alleged that Twitter had not provided sufficient disclosure regarding the number of spam and fake accounts on its platform.
In response, Twitter filed a lawsuit against the billionaire for failing to uphold his commitment to the company’s shareholders.
Eventually, Musk relented and proceeded with the purchase of Twitter at the agreed-upon price.
Some very strong allegations here of Twitter’s former senior management before Musk took over:
“X Corp. claims that by arranging to bill Twitter its hourly rates instead of taking the case on a contingency basis, Wachtell “undertook absolutely no risk in obtaining its mammoth…
— Tim (@CitizenYvr) July 8, 2023
Wachtell allegedly charged these “excess” fees under an agreement that was signed on the day of closing by Vijaya Gadde.
Gadde was Twitter’s chief legal officer. You may remember her name from journalist Matt Taibbi’s explosive “Twitter Files” report exposing the coverup of Hunter Biden’s laptop by the social media platform.
“The decision was made at the highest levels of the company, but without the knowledge of CEO Jack Dorsey, with former head of legal, policy and trust Vijaya Gadde playing a key role,” Taibbi wrote about the laptop coverup in December.
Apparently, her unscrupulous actions did not end there.
X Corp v Wachtell by The Western Journal
While the case will be adjudicated in a court of law, it appears to the layperson that with the Twitter takeover complete, Gadde made a decision to empty the company’s coffers on the way out by giving a “last minute” $90 million “success” fee to Twitter’s lawyers.
The actions of Gadde and other members of Twitter staff before Musk’s involvement with the company were borderline illegal and clearly detrimental to the principles of free and open discourse in the United States, aimed at suppressing the voices of the American people.
Musk’s entrance into the picture has been a catalyst for change, as he has taken steps to restore trust in the platform by ending its censorship of conservatives and shedding on what was happening behind closed doors.
But standing up for the First Amendment hasn’t been without a cost to the SpaceX and Tesla CEO.
Musk paid a very high price for the company.
He shouldn’t have to pay for disgruntled or unethical employees looking to stick it to their boss on the way out.
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