Elon Musk countersuit accuses Twitter of fraud over 'bot' count

Elon Musk offered to buy Twitter earlier this year, then tried to back out of the deal

Elon Musk accused Twitter of fraud in a countersuit over his aborted $44 billion deal for the social media company, which he claimed held back necessary information and misled his team about the true size of its user base.

The countersuit by the billionaire and Tesla CEO alleges that Twitter committed fraud, breach of contract and violation of a securities law in Texas, where Mr. Musk lives.

Mr. Musk's counterclaims were filed confidentially last week and unsealed in a filing late Thursday at the Delaware Chancery Court.

Mr. Musk offered to buy Twitter earlier this year, then tried to back out of the deal by claiming the social platform was infested with a larger numbers of “spam bots” and fake accounts than Twitter had disclosed.

Twitter sued to force him to complete the acquisition. Mr. Musk responded by filing his countersuit.

Mr. Musk's attorneys argue in the countersuit that Twitter “misrepresentations or omissions” distorted the company's value and caused Mr. Musk to agree in April to buy it at an inflated price. They said Twitter's own disclosures revealed that it has 65 million fewer “monetisable daily active users,” who can be shown digital ads, than the 238 million that Twitter claims.

The filing also said most of Twitter's ads are shown only to a sliver of the company's user base.