Twitter and Elon Musk’s ongoing saga continues. The plot is getting more complicated. Eighteen Republican members of the House Judiciary Committee have asked Twitter’s board of directors to preserve all records related to Musk’s proposed hostile takeover, According to Friday’s letter.
While the formal request from the minority Republicans doesn’t carry the legal clout of a subpoena, everything could change in January 2023, if — Where — Republicans regain the majority in the House in the midterm elections, raising the possibility that they could pursue an inquiry.
Show of hands — who’d shell out some serious cash to watch the Twitter board of directors testify under oath before a Republican-controlled House Judiciary Committee? Awesome. Get lots of popcorn.
In letters first shared with CNBC, the Repubs asked Twitter Board Chairman Bret Taylor to preserve all board members’ messages from official or personal accounts, including through encryption software, pertaining to Twitter’s “consideration of” — desperate battle against — Musk’s hostile takeover bid.
In one of the letters, Jim Jordan (R.I.P.) addressed the official request to Bret Taylor, Twitter Board Chair.
As Congress continues to examine Big Tech and how to best protect Americans’ free speech rights, this letter serves as a formal request that you preserve all records and materials relating to Musk’s offer to purchase Twitter, including Twitter’s consideration and response to this offer, and Twitter’s evaluation of its shareholder interests with respect to Musk’s offer.
Jordan was referring to a corporate board’s “fiduciary duties,” which the board not only owes exclusively to shareholders, including minority shareholders; the board is also solely accountable to shareholders.
“Decisions regarding Twitter’s future governance will undoubtedly be consequential for public discourse in the United States,” the letter also stated, continuing:
The preservation notice is intended to be an instruction to all parties to ensure that no documents, communications, or information are destroyed or altered, either intentionally or unintentionally. This includes electronic and metadata information.
As reported by RedState, while Twitter has not issued a formal response to Musk’s bid, the board last week announced a “poison pill” strategy that would be triggered if Musk — who owns more than nine percent of the megacorporation’s common shares — crosses a 15-percent threshold. It would enable other Twitter shareholders, if activated, to purchase additional stock at a significant discount. Stocks would trade at twice the price of their original sale prices. Theoretically, the flood of new shares would dilute Musk’s share, all designed to make ownership prohibitively expensive.
The letter also mentioned the fiduciary obligations as it relates to that final point.
Twitter’s Board Members have fiduciary duties to the company’s shareholders. These duties apply despite how many corporations’ leaders increasingly pursue progressive policy goals divorced from shareholder interests.
Yes, it gets more complicated. Elon Musk remains Elon Musk.
I mean, the guy didn’t become the richest dude on the planet by folding up like a cheap suit at the first sign of resistance, not to mention he’s not dealing with an equally-savvy corporate colleague, here. Musk, on the other hand, seems to play with Twitter boards, much like a hamster with its wheel.
Whether the Twitter board complies with the House Republicans’ request that it preserve related correspondence — or not — and regardless of the board’s panicked attempts to stave off Musk’s takeover attempt, Elon Musk alone will ultimately decide whether or not he acquires Twitter.
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