Elon Musk Sues Twitter's Lawyers For Overcharging $90 Million In Fees Related To His Takeover

At a time when Mark Zuckerberg and Elon Musk¡¯s rivalry is deepening after not just the launch but the massive popularity that the Meta CEO¡¯s ¡®Twitter killer¡¯ app Threads is garnering, it seems that the world¡¯s richest person is busy with another task.

Elon Musk Sues Twitter's Lawyers For $90 Million

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Elon Musk has sued the law firm that led the court fight to make him complete his takeover of Twitter, saying it took advantage of the company while running up a $90 million bill.

Law firm Wachtell Lipton Rosen & Katz, among the most profitable firms in the US, exploited a brief, vulnerable period just as Musk was closing the $44 billion deal, according to a complaint filed in San Francisco state court by Musk¡¯s X Corp., now the parent of Twitter, as per Bloomberg.

Twitter had agreed to pay Wachtell lawyers on an hourly basis to enforce Musk¡¯s agreement to buy the company when he tried to back out, but the firm violated its ethical duties as well as California law in the final days of its four-month representation when it solicited ¡°gargantuan¡± bonus fees, according to the complaint.

Also Read: Elon Musk Briefly Changes Twitter's Bird Logo To Doge Meme

Among The Many Lawsuits In Musk's Tenure

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The lawsuit is something of a role reversal for Musk, who is more often than not a defendant in numerous lawsuits alleging that Twitter under his leadership allowed millions in unpaid expenses to pile up from former employees, vendors and landlords while purportedly trying to keep the company financially solvent.

Twitter has been involved in numerous actual or threatened litigation since Elon Musk's buyout happened in October last year. These include many lawsuits by landlords, vendors and consultants accusing Musk of stiffing them on bills, and a threatened lawsuit by Twitter against Mark Zuckerberg's Meta Platforms over the latter's new Threads app.

Even Wachtell is no stranger to lawsuits by billionaires over buyouts, having spent years litigating with Carl Icahn over his 2012 hostile takeover of CVR Energy. In 2018, a judge dismissed a malpractice claim by Icahn, who found himself on the hook to pay banks that helped defend CVR against the takeover higher fees than if the merger failed, as per Reuters.

Twitter's Legal Battle With Elon Musk Amid $44 Billion Takeover

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Also Read: List Of Companies Co-Founded/Headed By Elon Musk

Twitter¡¯s legal battle with Musk engaged dozens of lawyers on both sides for months, some charging upwards of $1,000 an hour ¡ª leading Columbia University law professor John Coffee to speculate that total legal fees could have exceeded $1 billion if the case had gone to trial.

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 success fee.¡± Moreover, the company¡¯s agreement with the law firm ¡°does not even specify the amount of the success fee, let alone any formula or percentage used to arrive at that figure,¡± according to the complaint, Bloomberg reported.

The suit also faults ¡°lame duck¡± executives at the social media platform went on a legal ¡°spending spree¡± before Musk took control.

¡°Fully aware that nobody with an economic interest in Twitter¡¯s financial well-being was minding the store, Wachtell arranged to effectively line its pockets with funds from the company cash register while the keys were being handed over to the Musk Parties,¡± according to the complaint.

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