Centi-billionaire Elon Musk provoked Twitter and challenged the company’s CEO Parag Agrawal to a “public debate” about fake accounts and spam in the midst of a contentious legal battle over a $44 billion acquisition.
Musk filed a bid with the Securities and Exchange to acquire Twitter back in April this year. After the companies agreed to move ahead with a take-private deal, Musk said he was terminating his acquisition, and accused Twitter of presenting false numbers, including in its SEC filings, pertaining to the amount of monetizable daily active users, and the number of spam and bot accounts on the social network.
Twitter then sued Musk in a Delaware chancery court to ensure the deal would go through as promised, and Musk filed counterclaims and a countersuit there on July 29.
In a series of tweets that Musk began posting just before 1 a.m. on Saturday, Aug. 6, Musk interacted with a fan who had summarized his accusations about Twitter including that it was stonewalling him and giving him, “outdated data,” and “a fake data set” when he asked the company for details about how it tabulates mDAU, and estimates for spam and bot accounts.
The Tesla and SpaceX CEO wrote, “Good summary of the problem. If Twitter simply provides their method of sampling 100 accounts and how they’re confirmed to be real, the deal should proceed on original terms. However, if it turns out that their SEC filings are materially false, then it should not.”
By just after 9 a.m. Saturday morning, Musk started a Twitter poll asking his followers to vote on whether “[l]ess than 5% of Twitter daily users are fake/spam.” Respondents to the informal poll could choose one of Musk’s provided answers which read either “Yes” followed by three robot emoji, or “Lmaooo no.” (The slang abbreviation “lmao” stands for “laughing my a– off.)
A source close to the company says a debate is not going to happen outside of a pending trial.
Attorneys for Musk did not respond to requests to comment on Saturday, and an attorney for Twitter declined to comment on Musk’s Saturday tweets.
Twitter’s attorneys have argued in court filings that Musk gave the company just twenty-four hours to accept his offer before he would present it directly to Twitter shareholders, and waived due diligence including a chance to seek more information on false or spam accounts.
They wrote in court filings, “Musk’s repeated mischaracterizations of the merger agreement cannot change its plain words.”
At an annual shareholder meeting for Tesla on Aug. 4, Musk was asked to speak about Twitter during a question-and-answer session that followed a proxy vote.
He said, drawing laughter from the audience in attendance, “I obviously have to be a little careful what I say about Twitter because there’s this lawsuit and stuff.” He confirmed that the only two publicly traded securities he owns are Tesla and Twitter.
And then he spoke as if he still wants to become the owner of the social networking company, a stark contrast to arguments made by Musk via his attorneys in legal filings in Delaware in which Musk argues he should not have to go through with the deal.
At the Tesla 2022 shareholders’ meeting, Musk said: “I think in the case of Twitter since I use it a lot, shoot myself in the foot a lot, you know, dig my grave, etc. I think it’s — I do understand the product quite well, so I think I’ve got a good sense of where to point the engineering team at Twitter to make it radically better.”
He added that Twitter would “help accelerate” a “pretty grand vision” he had to build a business he’d been thinking about since his earliest years as a tech entrepreneur, X.com or X Corporation.
“Obviously that could be started from scratch,” he said, “but I think Twitter would help accelerate that by three to five years. So it’s kind of like something I’ve thought would be quite useful for a long time. I know what to do. Don’t have to have Twitter for that but, like I said, it’s probably at least a three-year accelerant and I think it’s something that will be very useful to the world.”
Musk didn’t go into any further details at that meeting. However, he reportedly said during a town hall meeting with Twitter employees in June this year that he wanted to grow Twitter’s user base to a billion people and saw Twitter as a platform that could evolve into an app like China’s WeChat, a “super app,” that incorporates everything from messaging, video and social media, to mobile and point-of-sales payments, with a robust app ecosystem.
Unless they reach a settlement first, Twitter and Musk are headed for a five-day trial in Delaware that starts on Oct. 17. The judge ruling on the case is Chancellor Kathaleen St. J. McCormick.
Kim Kardashian, Floyd Mayweather crypto scam lawsuit dismissed
A federal judge on Wednesday dismissed a proposed class action lawsuit by investors against the founders of the cryptocurrency EthereumMax, as well as celebrity endorsers including Kim Kardashian and boxer Floyd Mayweather Jr. over their promotion of the cryptocurrency on social media.
Investors who bought EMAX tokens alleged they had suffered losses after taking the word of the celebrity influencers about the value of the crypto. The suit claims the defendants engaged in a conspiracy to artificially inflate the value of the EMAX tokens.
Judge Michael Fitzgerald wrote that he recognized that the lawsuit’s claims raised legitimate worries about “celebrities’ ability to readily persuade millions of undiscerning followers to buy snake oil with unprecedented ease and reach.”
“But, while the law certainly places limits on those advertisers, it also expects investors to act reasonably before basing their bets on the zeitgeist of the moment,” wrote Fitzgerald, of the Central District of California.
The judge found that the plaintiffs’ allegations were insufficiently backed, especially “given the heightened pleading standards” for fraud claims, according to his ruling in U.S. District Court in Los Angeles.
In addition to Kardashian, Mayweather and former Boston Celtics star Paul Pierce, the defendants in the case included Steve Gentile and Giovanni Perone, the co-founders of EthereumMax, and Justin French, a consultant and developer for the cryptocurrency, court documents state.
Fitzgerald in his ruling said he would allow lawyers for the plaintiffs to refile their suit after amending some of their claims under a number of the statutes cited in the original complaint, which included the Racketeer Influenced and Corrupt Organizations Act, also known as RICO.
“We’re pleased with the court’s well-reasoned decision on the case,” Michael Rhodes, a lawyer for Kardashian, told CNBC.
The dismissal came weeks after investors in fallen crypto exchange FTX filed a class-action lawsuit against former FTX CEO Sam Bankman-Fried and celebrity advertisers for the company, among them NFL superstar Tom Brady, for allegedly overstating the value of the crypto tokens in promotional messaging.
And the ruling came two months after Kardashian agreed to pay $1.26 million, and not to promote cryptocurrency for three years, to settle claims by the SEC for her failure to disclose a $250,000 payment touting EthereumMax on her Instagram account.
Fitzgerald in his ruling Wednesday said the EthereumMax lawsuit reflects a broader conflict surrounding celebrity and influencer promotional schemes.
“This action demonstrates that just about anyone with the technical skills and/or connections can mint a new currency and create their own digital market overnight,” Fitzgerald wrote in his dismissal.
Investors sued EthereumMax and its celebrity advertisers in January after a slew of influencers started snagging sponsorships to promote cryptocurrencies to their millions of social media followers.
Kardashian’s Instagram post in June 2021 had written, “Are you guys into crypto??? This is not financial advice but sharing what my friends told me about the Ethereum Max token.”
Her post included “#ad” at the bottom, indicating she had been sponsored. But it did not disclose her $250,000 payment from EthereumMax.
Mayweather promoted EMAX at a boxing match and a large Miami bitcoin conference in June 2021.
But by January, the cryptocurrency had lost 97% of its value.
Fitzgerald at a hearing last month indicated he was inclined to dismiss the case.
Bloomberg News, in an article about that hearing, said that an attorney for the plaintiffs in the suit asked the judge to allow him to revise the suit’s racketeering claims to show how the statements by the celebrity defendants harmed the investors.
“If plaintiffs had known the true facts related to the promoters’ financial interest in the tokens, and that they were being paid to shill these tokens, they wouldn’t have paid as much for the tokens as they did,” the attorney, John Jasnoch, told Fitzgerald, according to a transcript cited by Bloomberg.
Cathie Wood says the Fed is making a serious mistake as bond market flashes worst signal since 1980s
How the U.S. became a global corn superpower
The United States has just about 90 million planted acres of corn, and there’s a reason people refer to the crop as yellow gold.
In 2021, U.S. corn was worth over $86 billion, according to calculations from FarmDoc and the United States Department of Agriculture.
According to the USDA, the U.S. is largest consumer, producer and exporter of corn in the world.
“We’re really good at [corn production],” Seth Meyer, chief economist at the USDA, told CNBC. “And that’s why you see big acres, big demand, export competitiveness.”
It’s not just what we eat.
“We turbocharged the value of corn through the application of science,” Scott Irwin, agricultural economist and professor at the University of Illinois, told CNBC.
Corn is in what we buy, including medications and textiles, and corn is turned into ethanol, which helps to fuel cars across the nation.
The rest of the world relies on U.S. corn, too.
At $2.2 billion in 2019, corn is the most heavily subsidized of all crops in the country.
“A lot of these subsidies … do get embedded into the cost of farmland and they essentially bid up the price of farmland marginally,” Joseph Glauber, senior research fellow at the International Food Policy Research Institute and former USDA chief economist, told CNBC. “So the benefits accrue largely to those who own land.”
The federal crop insurance program’s net spending is forecast to increase to nearly $40 billion from 2021 through 2025, according to the Congressional Budget Office.
At the same time, farmland values have reached all-time record highs.
“Do we get the corn acres because we’ve got the support, or do we have the support because we have the corn acres?” Meyer said, posing the chicken-and-egg question about the nation’s grain superpower.
Watch the video above to learn more about how corn fuels the U.S. economy from its people to its vehicles, the power of the corn belt states, the role of subsidies and where government policy for the industry may go from here.
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