4 ms·

The point to me seems to be to set up things where this won’t go to court: if the primary claim is that Twitter misstated mDAU, the downside risk to Twitter is

by gfodor 4y ago

The point to me seems to be to set up things where this won’t go to court: if the primary claim is that Twitter misstated mDAU, the downside risk to Twitter is far greater than to Musk (I think) to have that fact finding occur. If it turns out the court agrees with Musk, then in one swoop the deal falls through, Musk is vindicated, the reputation of Twitter’s entire executive leadership and board is permanently damaged, and the market will punish the hell out of the stock due to the first and higher order impact of this on their valuation. The choice for Twitter boils down to what level of price cut are they willing to make to remove that possibility.

_djo_ 4y ago
Twitter seems pretty confident about revealing their process to calculate that figure: They’ve described it multiple times and been explicit in their SEC filings. As they should have been, as it’s a sound enough process given constraints and doesn’t need to be 100% accurate. They have nothing to worry about.
- gfodor 4y ago
  I've been downvoted but what you state is exactly right: they have to decide exactly how confident they are in their own process holding up in court (which isn't exactly the same thing as it being accurate) - and to whatever degree they are not confident, back it out to a price change to de-risk the outcome I mentioned. I agree with you that they seem confident, but the entire back and forth around mDAU originated with Musk and my belief is that choice of dispute was taken in the interest of setting things up so they won't actually go to court. The gambit of course may fail and it may go to court.
  - _djo_ 4y ago
    They’re going to court, because Twitter holds all the cards here and have the strongest legal case, so it’s in their best interests to have this adjudicated by a Delaware court. Musk is trying to pretend the mDAU = number of active bots. It’s dishonest, and likely designed to hurt the company and tank its share price and therefore bully it into conceding. Given the strength of their case I don’t see that happening.

by gfodor 4y ago

_djo_ 4y ago

Twitter seems pretty confident about revealing their process to calculate that figure: They’ve described it multiple times and been explicit in their SEC filings. As they should have been, as it’s a sound enough process given constraints and doesn’t need to be 100% accurate. They have nothing to worry about.

gfodor 4y ago
I've been downvoted but what you state is exactly right: they have to decide exactly how confident they are in their own process holding up in court (which isn't exactly the same thing as it being accurate) - and to whatever degree they are not confident, back it out to a price change to de-risk the outcome I mentioned. I agree with you that they seem confident, but the entire back and forth around mDAU originated with Musk and my belief is that choice of dispute was taken in the interest of setting things up so they won't actually go to court. The gambit of course may fail and it may go to court.
- _djo_ 4y ago
  They’re going to court, because Twitter holds all the cards here and have the strongest legal case, so it’s in their best interests to have this adjudicated by a Delaware court. Musk is trying to pretend the mDAU = number of active bots. It’s dishonest, and likely designed to hurt the company and tank its share price and therefore bully it into conceding. Given the strength of their case I don’t see that happening.