Twitter is suing Wachtell over the $90M payment for Musk's buyout

In its lawsuit, Twitter charged Wachtell, Lipton, Rosen & Katz with improperly obtaining a $90 million payout as Musk's witter acquisition deal's closing date approached.

In a complaint submitted on Wednesday to the California Superior Court in San Francisco, Twitter claimed that the litigation department at Wachtell, headed by William Savitt, was at the center of a spending spree by the company's departing executives. Wachtell was the law firm that Twitter hired previously to enforce Elon Musk's agreement to buy the company. Twitter is requesting complete reimbursement for the $90 million it paid Wachtell. In the complaint, Twitter claims that the sum includes an unidentified "success fee" that is excessive and unfair.

A request for comment was not answered by Savitt, the Wachtell's lawyer in the Twitter case.

Musk completed his acquisition in October in a $44 billion deal. Despite instructions from the new ownership to halt payment to third parties ahead of the impending merger, Twitter accuses Wachtell of making an impromptu change to its fee structure the day of the closing.

The day the deal closed, the board of Twitter approved the payment to Wachtell, claims the lawsuit. A request for comment was not answered by Bret Taylor, who was at the time the chairman of Twitter's board of directors.

A $90 million payment didn't seem like much, according to legal advisor Bruce MacEwen, provided that the acquisition deal had a $44 billion value. This did not seem out of line to MacEwen, president of the consulting company Adam Smith, Esq.