August 11, 2022

The first female chief judge on Delaware’s nationally known business court will oversee Twitter’s lawsuit that seeks to hold Elon Musk to his agreement to buy the social media platform for $44 billion, according to court records.

Kathaleen McCormick took over the role of chancellor, or chief judge, last year after the retirement of Andre Bouchard on the Court of Chancery, a favored venue for large corporate disputes.

Among McCormick’s first decisions will be a request by Twitter to hold a four-day trial in September, an incredibly tight time frame for such a complicated case.

McCormick’s final ruling on the merger can be appealed to the Delaware Supreme Court.

Twitter accused Musk of a long list of violations of the merger agreement in the lawsuit it filed on Tuesday. It said the world’s richest man wanted to back out in part because of a downturn in the stock of Tesla, the electric vehicle maker where he is chief executive. 

Elon Musk has accused Twitter of breaching the merger agreement because it refused to share information on spam accounts.
Patrick McMullan via Getty Image
Kathaleen McCormick
Judge Kathaleen McCormick
Delaware Courts

“Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away,” Twitter wrote in a 241-page complaint filed in the Delaware Court of Chancery.

Musk accused Twitter of breaching the merger agreement because it refused to share information on spam accounts, made misrepresentations and strayed from its normal course of business by firing executives.

Musk’s legal team added that Twitter had unjustifiably ignored and rejected requests for data on how the company calculates what percentage of its users are bots. Twitter says the figure is lower than 5%, while Musk has claimed it could be far higher. 

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McCormick is also overseeing a case by shareholders of Tesla who are seeking to void Musk’s $56 billion compensation package from the automaker. She scheduled an October trial in that case.