Texas Attorney General Ken Paxton handed Elon Musk an incredible gift this week when he announced his intention to investigate Twitter for misrepresenting their user base with bots.
AG Paxton made the announcement on the Texas AG Twitter account, suggesting his reasoning for the investigation is to “protect Texans”.
“Today I’m investigating Twitter for potentially misleading Texans on the number of its “bot” users. I have a duty to protect Texans if Twitter is misrepresenting how many accounts are fake to drive up their revenue.”
Tesla CEO Elon Musk relocated to Texas along with his companies during the pandemic following shutdowns in California, making him technically a Texan now.
Musk is currently attempting to buy Twitter and take it private. Initially they agreed on a $44 billion buyout, however Musk has recently suggested he may pull out after disclosing his belief that a large number of their followers are fake.
The head of SpaceX is now threatening to pull out of the Twitter deal, going so far as having his attorneys file a form 13D with the Security and Exchange Commission. His attorneys pointed to Twitter’s refusal to let Elon have full access to the data on users as well as let him perform his own analysis. The filing read:
“Based on Twitter’s behavior to date, and the company’s latest correspondence in particular, Mr. Musk believes the company is actively resisting and thwarting his information rights (and the company’s corresponding obligations) under the merger agreement. This is a clear material breach of Twitter’s obligations under the merger agreement and Mr. Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement.”
Texas AG Paxton’s state level investigation is almost certain to give Elon Musk another reason to be able to nix the deal or renegotiate the price. Musk has become a major political player in Texas and around the nation recently. Do you believe it’s acceptable to use state funds to support the world’s richest man’s buyout or is Paxton overstepping his bounds?