The Legal Brief - 18th May 2022

This week, two of our writers, Kate and Gabrielle, have both tackled one of the biggest ongoing stories - Elon Musk's takeover of Twitter. We have included both articles for you, so you can see a couple of different takes on the story, which is causing quite a stir.

Three weeks after the tech billionaire and Tesla owner, Elon Musk, agreed to buy global social networking site Twitter for $44 billion, many are still speculating whether the deal will succeed or fall through.

Criticisms of the lofty price tag began immediately after it was announced, with investors arguing that the $54.20 per share deal price would be an unreasonable price for a company whose shares had fallen to just $46.75. As a result, investors posited that the deal had less than a 50% chance of going through.

This view is shared by Donald Trump, who claimed there was ‘no way’ Musk’s deal would be successful on rival social media site Truth Social. This comes after many have suggested that Musk would remove former President Trump’s twitter ban in an attempt to enhance free speech on the site.

It appears these suggestions were right, with the tech billionaire announcing on Friday that the deal was temporarily ‘on hold’ pending further investigation into the claims of the social media company that less than 5% of accounts were fake accounts or bots, believing himself that up to 20% were fake. Announced through a tweet, Musk’s statement fuelled speculation among investors that he was attempting to renegotiate a lower price or walk away from the deal entirely, taking the $1 billion penalty this would cost on the chin.

However, on Monday, Musk announced that he was still considering the deal, but that it depended on many factors, making anecdotal reference to buying a termite-ridden house. This saw a further 8% fall in stock price that leaves current prices 30% lower than the $54.20 deal price, which investors viewed as evidence of Musk’s attempts to renegotiate a lower price.

Twitter boss, Parag Agrawa, has defended the company’s count, explaining that the number had been reached after analysing a number of private and public datasets. He added that half a million accounts suspected to be fake are deleted daily, while millions more are locked.

However, ultimately, it is now unclear whether Musk is getting cold feet or simply posturing to negotiate a lower price based on the falling stock price of the social media site. Musk has big plans for Twitter, hoping to develop it into something akin to WeChat.

Written by Kate Gregory

On the 14th March 2022, Musk purchased just above 9% of Twitter which made him the largest outside shareholder. After multiple discussions in relation to prices, it was agreed that each share would cost $54.20. Therefore, the Twitter takeover is going to cost Musk ￡35 billion. Elon Musk expressed his intention to loosen the moderation rules and allow Twitter to become a platform for free speech, particularly to reverse the ban on former US President Donald Trump.?

This deal has the potential not to go forth due to the current questions in relation to proving that fewer than 5% of its users are fake or spam accounts as it is estimated that 20% of the users are fake users. These accounts are known as “bot accounts” which are typically known to be automated rather than real-life human users. The bot accounts are significant as they are used to benefit individual users who could buy followers, likes and retweets. If the numbers return and they are higher than what Twitter estimates (5%) this could constitute a “material adverse misstatement” within the formal agreement which was signed by Elon Musk.?

If Elon Musk decided to break the deal, he will be charged $1 billion and may even be forced to complete the deal and pay the $54.20 per share. However, it has been suggested that Elon Musk may seek a lower price for Twitter due to the fake account issue. The question is what the world’s richest man will do next with his Twitter Takeover.?

Written by Gabrielle Coates

Over recent weeks, we have seen potential drama developing as a result of two countries, Finland and Sweden, announcing plans to join NATO. This would be an historic move, as both countries would be departing from a long-held stance of neutrality to join the organisation.

This news did not go down well with Russian President, Vladimir Putin, who seemed initially to threaten military action should either country make the final move and actually join.

However, in a surprising turn of event yesterday, Putin has seemed to make somewhat of a U-turn, announcing he is actually happy for both countries to join NATO, assuming that they don't install military bases or equipment. This is quite a departure from the threat of military action, and took many political commentators by surprise.

There are a number of interesting angles to this story. Firstly, will other countries now be tempted to follow suit? It is foreseeable that small countries, for whom a threat of military action could be catastrophic, may now be more likely to seek the collective protection that NATO would bring.

Secondly, it would be really interesting to see how this news is being portrayed in the Russian media. With this news, combined with the news the McDonalds are set to leave the country for good after 30 years, it is a difficult day's news to show as a "win" in terms of the war with Ukraine. It would be really interesting to see what angle is used on both of these stories by state media, and whether they are able to say both of these are a good things relating to the current situation.

Much as we cannot be sure what commercial implication will come out of this story specifically at this moment in time, we can be sure that there will be some. Once the dust settles on these arrangements, and the conflict, there will undoubtedly be some supply chain, and trading, changes. Much as NATO membership is a military alliance, often these alliances can transfer into trading agreements between members states.

The final interesting thing about this story is the, as yet relatively quiet, response of China to this news. China have in the past but a little wary of the growing size of NATO, and you could reasonably expect this news to unsettle their government too. However, they have also been quiet so far on the Russia-Ukraine war too, so it is possible they are just keeping out the way of this problem, perhaps perceived by residents as confined to Europe, for the time-being.

Written by Duncan Balcon

The Business Side of The Bar ??????

This week on the?Legally Speaking Podcast ???powered by?Clio - Cloud-Based Legal Technology?we welcomed?Lawrence Power?to the show!

Lawrence is a Barrister and was called to Middle Temple in 1995.

Since being called, Lawrence has built a large high-profile practice and has been the Head of Chambers for over 15 years at?Whitestone Chambers?in London, specialising in Commercial and Aviation Law.

Lawrence has encouraged the expansion and development of the set in a direction focused on maintaining its reputation for first rate legal services based on first class recruitment and training.

Lawrence has been qualified to train barristers, since 2004 and been appointed an Advocacy Trainer,?The Honourable Society of the Inner Temple, since 2014.

Lawrence is well known for the large number of events and talks he has participated in as a guest speaker which is reflected in his recent award from Gen Z - ‘Supporter of the Year’.

Lawrence received this due to his consistently going above and beyond to help young people. Lawrence shares plenty of tips in relation to the future of the bar and how to utilise the business side of the bar.

Lawrence is the IP editor for the Journal of Alternative Dispute Resolution. He has also reviewed ‘Electronic Finance Law’, Computer and Artificial Intelligence Journal and contributed to Archiving Computer Transactions and The Law of Due Diligence.

He is currently writing a new textbook regarding the advocacy required in different courts, tribunals and enquiries.

In this episode, we discuss the following:

?? His career as Head of Whitestone Chambers for 15 years

?? What is a Barrister and how to build a practice of similar nature

?? How to deal with rejection during application and interview process

?? The business end of being a Barrister

?? Out now on the Legally Speaking Podcast website and all major audio platforms!

Aviation Finance?- Global Law Firm - Junior Associate (London)

Capital Markets Associate?- Global Law Firm - 2 - 4??PQE (London)

Commercial IT Associate/Senior Associate?- Global Law Firm (London)

Commercial Litigation Associate x 2 (Trade/Commodities)?- Global Law Firm (London)

Corporate Associate & Senior Associate x 2?-?Global Law Firm (London)

Disputes Associate?- Global Law Firm - 4 - 5?PQE (London)

Finance Associate?- Global Law Firm 3 - 4?PQE (London)

Financial Regulatory Associate?- Global Law Firm 3 - 5?PQE (London)

M&A Associate?- Global Law Firm 2 - 4 PQE (London)

Marine Asset Finance?- Global Law Firm NQ – 3 years?PQE (London)

Marine Assets & Projects?(EMNR Group A)?- Global Law Firm

Professional & Finance Disputes Associate/Senior Associate?- Global Law Firm 2+ PQE (London)

Professional Indemnity Junior Associate/ Associate?- Global Law Firm (London)

Real Estate Disputes Associate?- Global Law Firm (London)

For further information, or to get your questions answered, please send a message to?Robert Hanna.

If you cannot see a job suitable for you, but are interested to hear about more jobs at KC Partners, please send your CV to?[email protected]?to be considered.

At KC Partners we are committed to promoting diversity and equality of opportunities across organisations and we welcome applications from suitable candidates regardless of race or racial group, religion or belief, age, disability, sexual orientation, sex, gender re-assignment and gender identity, marriage and civil partnership, and pregnancy, maternity and paternity.

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