‘Exhibit Q’: Elon Musk Cranks Up Effort to Scrap Twitter Deal With Explosive New Claims

By Tom Ozimek
Tom Ozimek
Tom Ozimek
Reporter
Tom Ozimek has a broad background in journalism, deposit insurance, marketing and communications, and adult education. The best writing advice he's ever heard is from Roy Peter Clark: 'Hit your target' and 'leave the best for last.'
August 30, 2022 Updated: September 5, 2022

Tech entrepreneur Elon Musk has dialed up his efforts to back out buying Twitter by filing a new termination notice underpinned by “Exhibit Q,” a document that references bombshell claims made by Twitter’s former security chief-turned-whistleblower and accuses Twitter of “far-reaching misconduct” that is likely to have “severe consequences” for its business.

Musk said in an Aug. 30 filing with the Securities and Exchange Commission (SEC) that his lawyers sent Twitter an Aug. 29 termination letter that gives new justification to Musk for pulling out of the $44 billion buyout agreement.

While Musk said he’s convinced his earlier July 8 termination letter has already “validly terminated” the buyout agreement, he opted to send Twitter the new Aug. 29 termination letter as a failsafe, in case the earlier one “is determined to be invalid for any reason.”

The new termination letter is fully justified by the contents of Exhibit Q, Musk said, which is a document detailing the claims made by ex-Twitter security chief Peiter Zatko, who in a whistleblower disclosure (pdf) made a series of explosive claims, including that Twitter was “lying about bots to Elon Musk.”

Exhibit Q

The document labeled Exhibit Q references the disclosure by Zatko, who also is known by his hacker handle “Mudge,” noting that it “alleges far-reaching misconduct” at Twitter that is “likely to have severe consequences for Twitter’s business.”

Zatko’s claims in the disclosure include accusing Twitter of “extreme egregious deficiencies” in the way it handled user information and alleging it had falsely claimed to federal regulators that it had a solid security plan.

“Twitter is in material noncompliance with both its obligations under a 2011 FTC consent decree and its general obligations under data privacy, unfair trade practice, and consumer protection laws and regulations,” Exhibit Q states.

Twitter also had difficulty identifying—much less restricting—the presence of foreign agents on its platform, Zatko claimed in his disclosure, while asserting that Chinese entities gave money to Twitter, raising concerns that these entities could access sensitive information about Twitter users.

“Twitter acquiesced to demands made by the Indian government that its agents be hired by Twitter and given access to Twitter user information,” Exhibit Q says.

Zatko also claims Twitter experienced server vulnerabilities, alleging that more than 50 percent of Twitter’s 500,000 data center servers had kernels or operating systems that were noncompliant and many had problems with encryption.

“Twitter is uniquely vulnerable to systemic disruption resulting from data center failures or malicious actors, a fact which Twitter leadership (including its CEO) have ignored and sought to obfuscate,” Exhibit Q states.

If true, Zatko’s claims prove that Twitter has broken its obligations under its merger agreement with Musk, giving him the right to back out of the deal, according to Exhibit Q.

Twitter has not returned a request for comment from The Epoch Times on Musk’s new termination letter and Zatko’s claims.

Parag Agrawal, Twitter CEO, has dismissed Zatko’s allegations in a message to staff as a “false narrative that is riddled with inconsistencies and inaccuracies, and presented without important context.”

“We will pursue all paths to defend our integrity as a company and set the record straight,” he wrote in the message.

Musk and Twitter are poised to go to trial in October in a Delaware court, with experts saying the whistleblower’s claims could give Musk a leg up in the court battle.

Tom Ozimek
Reporter
Tom Ozimek has a broad background in journalism, deposit insurance, marketing and communications, and adult education. The best writing advice he's ever heard is from Roy Peter Clark: 'Hit your target' and 'leave the best for last.'