CNN reported last week that a Twitter whistleblower, former employee Peiter “Mudge” Zatko, alleges that the leadership at the “digital public sqare” has “misled its own board and government regulators about security vulnerabilities.” Zatko alleges that some of the vulnerabilities make the platform rife for “foreign spying or manipulation, hacking and disinformation campaigns.” Furthermore, Zatko claims that the platform does not delete user information in the event the account holder deletes their account, as it is required to do.
Zatko was fired by Twitter in January; Zatko says he was working to “flag security lapses . . .help Twitter fix years of technical shortcomings and alleged non-compliance” that the Federal Trade Commission required. He says he has not been in contact with Elon Musk (as of August 23), and that his decision to participate in the whistleblowing exercise prior to Musk’s offer to purchase the platform for $44 billion.
On Monday, Musk’s legal team sent correspondence to Twitter in light of Zatko’s statements. The letter was disclosed to the SEC (Securities and Exchange Commission), with whom Musk has been wrangling regarding his original offer. While Musk cited a misrepresentation of bots on the platform as one of his main reasons for wanting to back out of his offer, the information Zatko presents could very well assist Musk’s case.
In his missive, Musk cited Zatko’s claims about cybersecurity, non-compliance on the part of Twitter to meet FTC regulations, and the violation of intellectual property rights. Musk says that if these allegations are true, then that is evidence of a “breach on Twitter’s side of the acquisition bargain.” This would allow for Musk to walk away from his original deal.
Musk had announced in July that, due to what he claimed were misrepresentation of the way the platform handles spam and fake accounts. Twitter sued Musk, saying that he violated the acquisition agreement. Twitter wanted Musk to go through with the deal, even if forced by a court. The case doesn’t come before a judge until October.
Twitter has criticized Zatko as well as his allegations. The platform also sent a letter to Musk, calling his latest attempt to rescind the deal “invalid and wrongful.” Twitter has said that Zatko’s statements are “riddled with inconsistencies and inaccuracies and lack important context.”
Legally, Musk’s latest filing isn’t necessary since he already has one motion to cancel the purchase pending. However, the judge in the case could use Zatko’s claims to terminate the deal provided the initial Musk claim is thrown out. Musk’s legal team wrote: “Because these facts were known to Twitter and withheld from Musk, and because Twitter has since taken the position that the Merger Agreement remains in effect, the Musk Parties hereby provide this additional notice of termination of the Merger Agreement.”
Zatko claims that Twitter’s handling of security matters has not only put Twitter users’ identities at risk, but there are also “egregious deficiencies” that could put national security at risk. Zatko published his report in an 84-page missive that was sent to Congress in July.
Twitter responded to Musk’s latest filing be reiterating what it had previously said about Zatko’s claims. Twitter maintains that it has not breached the initial agreement between the company and Musk.
Musk’s filing cites the Zatko Complaint, which holds that Twitter “never acquired the rights to (its own) core machine learning models.” The filing continued to claim that if this is true, then not only could the company incur “significant monetary damages,” but the business itself could be threatened.
Zatko alleges that at least 3,500 Twitter employees are allowed to access user data, and Twitter possesses “no control over thousands of devices used to access core company systems.”
Musk wrote in his correspondence that not only is an SEC and FTC investigation of Twitter likely, but that privacy data agencies in both Ireland and France are already investigating Twitter. If so, Twitter could be in the midst of multiple legal squabbles.
If the judge hearing the October case allows for Musk to back out of the Twitter deal, he could still offer to purchase the company for a much smaller sum.
