Texas Attorney General Ken Paxton initiated a probe into Twitter on Monday to see if the company is lying about the number of bogus bot accounts on the network.
According to Paxton’s office, “bots” or spam accounts “inflate followers and reach, and often push deceptive and annoying activity,” Fox News reports.
According to the research, “A large number of bot accounts not reduces users’ experience on the platform, but may also inflate the value of the company and the costs of doing business with it, thus directly harming consumers and businesses – specifically, Texas consumers and businesses.”
“Texans rely on Twitter’s public statements that nearly all its users are real people. It matters not only for regular Twitter users, but also Texas businesses and advertisers who use Twitter for their livelihoods,” said Paxton. “If Twitter is misrepresenting how many accounts are fake to drive up their revenue, I have a duty to protect Texans.”
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The deadline for Twitter to react is June 27.
Twitter said it “has and will continue to cooperatively share information with Mr. Musk to consummate the transaction in accordance with the terms of the merger agreement” in an emailed response to Bloomberg.
The firm stated that it thinks the acquisition is in the best interests of all shareholders and that it plans to “close the transaction and enforce the merger agreement at the agreed price and terms.”
TWTR stocks have regained some of their initial losses.
In an updated 13D filing, Elon Musk stated that he feels Twitter is violating their merger agreement by failing to provide information regarding spam and fraudulent accounts.
By refusing to release the material, Musk feels Twitter is “actively resisting and thwarting his information rights.”
Musk appeared to hint in late May that his buyout offer would be jeopardized due to the quantity of bots on the platform.
The issue erupted in May after Musk posted a Reuters report estimating that fraudulent accounts constitute for less than 5% of Twitter users, to which Musk responded:
TWTR shares was hammered by 7% before the bell because of the latest 13D filing.
Read the following letter in its entirety:
Just a little more negotiating? What is the next logical step? In a Washington, DC court, Twitter sues Musk, and the judge determines that the ‘fair value’ of Twitter is $500 per share?
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