David Bridges
Topline
Attorneys for Elon Musk issued a subpoena to Twitter whistleblower Peiter Zatko as part of the company’s ongoing lawsuit against the Tesla CEO, according to court filings Monday, after Zatko alleged the company intentionally undercounted and misrepresented the number of bots on the social network—similar to the argument Musk is using to get out of his Twitter deal as it goes to trial in October.
Elon Musk attends The 2022 Met Gala on May 2 in New York City.
Key Facts
The subpoena, filed Monday in Delaware Chancery Court, asks Zatko to turn over a wide range of documents and communications regarding Twitter’s operations and his work at Twitter, including detailed information on bots and spam accounts and any “engagement in any unlawful activity” by Twitter.
Zatko filed a whistleblower complaint with the federal government in July alleging a wide range of misleading actions, “egregious” security violations and fraud, including that the company intentionally undercounts the number of bots on its platform.
Twitter has claimed that bot accounts make up only 5% of its Monetizable Daily Active Users (mDAUs), but Zatko’s complaint alleges Twitter “avoid[s] counting spam bots as mDAUs” and there’s “deliberate ignorance” among executive leadership about how many spam bots there actually are—meaning there might be millions more bots than the company actually claims.
That ties into the claims that Musk has used to try and get out of his deal to buy Twitter, as he’s argued Twitter’s 5% figure for spam bot accounts is false and the company “failed or refused to provide” further information about the spam bots on its network.
The subpoena was filed in court Monday after Musk’s lawyers previously referenced Zatko in court and suggested they would likely use the whistleblower to bolster their case.
Twitter declined to comment on the subpoena to Forbes, and Musk’s lawyer Alex Spiro has not yet responded to a request for comment.
Crucial Quote
“Musk’s suspicions [about Twitter]
Chief Critic
Twitter has denied Zatko’s claims. Spokeswoman Rebecca Hahn said in a statement to the Washington Post, which first reported his allegations, that the whistleblower complaint is “riddled with inaccuracies” and Zatko “now appears to be opportunistically seeking to inflict harm on Twitter, its customers, and its shareholders.”
What To Watch For
What Zatko’s testimony will mean for Twitter’s lawsuit against Musk and his attempt to get out of the deal. Legal experts cited by the Guardian noted the whistleblower’s complaint is “very convenient for Musk” and could help his case, even though Zatko’s claims about the company are not identical to Musk’s arguments. Musk would have to ask the court’s permission to incorporate any of Zatko’s allegations into his existing case against the company, the New York Times notes, which it’s unclear if it will grant. The Times points out Musk could also bring a new lawsuit against Twitter arguing the company accusing the company of fraud for not including Zatko’s allegations in its 2021 annual report—a strategy that Spiro has already suggested in court that they could pursue, pointing out the company’s report was filed after Zatko wrote to Twitter executives about his concerns. The trial in Twitter’s lawsuit against Musk is slated to start on October 17.
Key Background
Zatko, a hacker also known as “Mudge,” worked at Twitter from 2020 until his firing in January 2022. His whistleblower complaint makes a series of damning allegations against Twitter and its security practices, accusing the social network of violating a settlement agreement with the Federal Trade Commission because the company did not have a sufficient security plan; hiring an agent of the Indian government and that he was fired after refusing to present “false and misleading documents” to the Twitter board, among other allegations. The reports of his complaint caused the company’s stock prices to tumble and analysts to downgrade shares of Twitter stock. Musk and Twitter initially reached a $44 billion deal for the Tesla CEO to buy the company in April, but Musk filed paperwork in July to terminate the agreement, after saying in May he was putting the deal on hold until Twitter could provide more information on the spam and bot accounts. Twitter then sued Musk in Delaware state court on July 12 in an attempt to stop him from backing out of the deal, arguing he was trying to do so because his personal wealth has suffered rather than because of legitimate concerns about the company.
Further Reading
What the Twitter whistleblower could mean for Elon Musk’s takeover deal (CNN)
Twitter Whistleblower: Here’s What Former Security Chief Peiter Zatko Claims (Forbes)
