How weird could things get if Twitter settles with Elon Musk?

As Elon Musk’s imbroglio with Twitter strikes from the boardroom to the courtroom, one would possibly anticipate that, underneath the watchful eye of Delaware’s Court docket of Chancery, issues will tackle a extra predictable trajectory than they’ve to date.

In concept, the lawsuit that the social media platform launched Tuesday to drive Musk to comply with via on his acquisition provide presents a restricted spectrum of potential outcomes: Musk could possibly be pressured to shut on the agreed-upon $44-billion value; pay a $1-billion termination charge to get out of the deal; cough up some middleman value that the courtroom decides; or escape fully unscathed.

But if there’s one lesson to be discovered from all that’s transpired to date, it’s that there aren’t any ensures, even within the face of binding contracts, federal rules and historic precedents, relating to the world’s richest man. Settlement continues to be an choice — some consultants even say it’s probably — and would open up a complete new menu of choices. Listed below are a few of them.

Nondisparagement agreements

Musk has by no means been one to carry off on criticizing Twitter, regardless of being among the many platform’s largest customers.

He has panned its content material moderation insurance policies as undemocratic, lobbied for main adjustments to each the corporate’s product and its enterprise mannequin, and persistently criticized the positioning’s dealing with of automated spam bots (Twitter’s “single most annoying downside,” he as soon as wrote).

Signing a deal for him to purchase the platform didn’t uninteresting these barbs. In a single tweet that Twitter included in its lawsuit, he responded to a comment by Chief Govt Parag Agrawal with nothing however the “poop” emoji.

“Since signing the merger settlement, Musk has repeatedly disparaged Twitter and the deal, creating enterprise threat for Twitter and downward stress on its share value,” the corporate complained within the submitting. That is regardless of a provision of the deal that required that Musk’s tweets “don’t disparage the Firm or any of its Representatives.”

It wouldn’t be uncommon for that form of settlement to change into a part of a longer-term settlement, stated Charles Elson, founding director of the Weinberg Heart for Company Governance. “You might have a nondisparagement settlement” underneath these types of circumstances, he stated. “I wouldn’t be shocked.”

“He wouldn’t disparage Twitter, they wouldn’t disparage him,” Elson added. “It’d be a mutual nondisparagement.”

Whether or not Musk would really abide by these phrases is, in fact, an altogether completely different query.

Nondisclosure agreements

Additionally on the desk could possibly be some form of nondisclosure settlement, or NDA, which might restrict what one or each events may publicly share concerning the on-again, off-again relationship they’ve engaged in since early April.

“I may undoubtedly see an NDA taking place which might maintain sure phrases confidential and permit a facet to ‘save face,’” stated Alex Bruno, founding father of the Glendale-based company regulation agency Bruno Group, in an e mail.

Twitter should should disclose some data, nonetheless, on condition that it’s publicly traded, Bruno added.

This eventuality may show significantly interesting to Twitter as a result of, in response to the lawsuit, the corporate has given Musk vital entry to company intelligence throughout their dealings, together with about 49 tebibytes’ price of uncooked historic website knowledge.

Then once more, Musk appears to presently be certain by some form of NDA, and doesn’t seem all that involved about it. “Twitter authorized simply known as to complain that I violated their NDA by revealing the bot verify pattern dimension is 100!” he wrote in a single Could tweet, referencing his efforts to copy Twitter’s bot prevalence estimates.

A noncompete settlement?

One looming risk for Twitter is that if Musk doesn’t finish this saga because the platform’s proprietor, he might choose again up an concept he’s toyed with previously: competing with the corporate on his personal phrases.

In a single tweet this March, he asked what must be accomplished about Twitter’s content material moderation insurance policies, which he framed as undemocratic. In a follow-up, he pitched one potential plan of action: “Is a brand new platform wanted?”

Later that day he added, “Am giving critical thought to this.”

Now, with the advantage of having seen a few of Twitter’s internal workings firsthand — and loved months of free press about how he’d run a social community had been he in cost — Musk may nicely return to that choice if he’s not barred from doing so.

Although Twitter options have traditionally struggled to enter the mainstream, it is a risk Twitter doesn’t take evenly. In its lawsuit, the corporate famous that Musk has stated he’ll “do one in all three issues with Twitter: sit on its board, purchase it, or construct a competitor” — the primary of which he’s opted out of, and the second of which he appears to be actively making an attempt to keep away from.

“The largest wildcard situation is that Musk must pay Twitter a large settlement quantity within the $5 billion to $10 billion vary and is restricted from beginning his personal social media platform,” stated Wedbush analyst Dan Ives, a frequent commentator on the Musk-Twitter saga, in an e mail to The Instances. “That might be a twilight zone ending to this circus present.”

Twitter coverage adjustments

Musk may even use a settlement as a chance to push for sure coverage adjustments — from extremely politicized ones reminiscent of these round how Twitter moderates customers’ speech, to the form of hobbyhorses that super-users like him care about, together with the addition of an “Edit Tweet” button.

Even when such concessions got here alongside a money settlement he needed to pay out, they could provide the general public determine an opportunity to avoid wasting face.

Nevertheless it’s an unlikely end result, Bruno stated.

“I don’t see a change in website insurance policies until some huge cash comes Twitter’s approach,” the legal professional wrote. Nevertheless, he added, Twitter should select to make adjustments “to publicly present their customers that they’re energetic in eliminating bots,” the main focus of a lot of Musk’s criticism.

Elson agreed. “I don’t suppose he would have the ability to get a change in enterprise practices from them. … Finally it is a enterprise transaction; it’s [about], ‘How a lot is that this factor price?’ That’s all.”

However Ives is extra open to the chance.

“If Musk finally is pressured to take possession of Twitter by the courtroom,” he stated, “there could also be some content material areas agreed upon as a part of a deal.”