COURT OF CHANCERY

OF THE

STATE OF DELAWARE

KATHALEEN ST. JUDE MCCORMICK

CHANCELLOR

LEONARD L. WILLIAMS JUSTICE CENTER

500 N. KING STREET, SUITE 11400

WILMINGTON, DELAWARE 19801-3734

September 22, 2022

Peter J. Walsh, Jr., Esquire

Kevin R. Shannon, Esquire

Christopher N. Kelly, Esquire

Mathew A. Golden, Esquire

Callan R. Jackson, Esquire

Potter Anderson & Corroon LLP

1313 N. Market Street

Hercules Plaza, 6th Floor

Wilmington, DE 19801

Brad D. Sorrels, Esquire

Wilson Sonsini Goodrich & Rosati, P.C.

222 Delaware Avenue, Suite 800

Wilmington, DE 19801

Edward B. Micheletti, Esquire

Lauren N. Rosenello, Esquire

Skadden, Arps, Slate, Meagher & Flom LLP

920 N. King Street, 7th Floor

Wilmington, DE 19899

Re: Twitter, Inc. v. Elon R. Musk et al.,

C.A. No. 2022-0613-KSJM

Dear Counsel:

This letter decision addresses the Second Motion for Leave to Amend Defendants’ 

Verified Counterclaims, Answer, and Affirmative Defenses filed by Defendants Elon R. 

Musk, X Holdings I, Inc. and X Holdings II, Inc. (“Defendants”) on September 9, 2022.1 

Plaintiff Twitter, Inc. filed its opposition on September 21, 2022.

2 I assume that the reader 

is familiar with the background of this dispute, so I will skip to the facts germane to the 

motion at issue.

1 C.A. No. 2022-0613-KSJM, Docket (“Dkt.”) 440 (“Second Mot. to Amend”).

2 Dkt. 566 (“Opposition”).
C.A. No. 2022-0613-KSJM

September 22, 2022

Page 2 of 5

Defendants previously moved for leave to amend their Complaint on September 7, 

2022, to add allegations concerning former Twitter employee Peiter “Mudge” Zatko’s

federal whistleblower complaint.3 Through their Second Motion to Amend, Defendants 

seek leave to allege facts revealed to Defendants for the first time on September 3, 2022, 

regarding a June 28, 2022 severance agreement entered between Twitter and Zatko 

reflecting a $7.75 million payment to Zatko. According to Defendants, Twitter did not 

seek Defendants’ consent before making the payment to Zatko, although such consent was 

allegedly required under Section 6.1(e) of the merger agreement. 

Plaintiff does not oppose the Second Motion to Amend. This is wise given that 

Court of Chancery Rule 15(a) provides that leave to amend should be “freely given when 

justice so requires.”4 This court interprets Rule 15(a) to “allow for liberal amendment in 

the interest of resolving cases on the merits.”5 Leave to amend is therefore typically 

granted.

Plaintiff instead argues that granting the Second Motion to Amend should be 

conditioned on Defendants’ compliance with Plaintiff’s additional discovery demands 

relating to the motion. Specifically, Plaintiff has propounded two additional document 

requests and one interrogatory. 

The document requests sought:

3 See Dkt. 244, Ex. A.

4 Ct. Ch. R. 15(a).

5 Gould v. Gould, 2011 WL 141168, at *7 (Del. Ch. Jan. 7, 2011).
C.A. No. 2022-0613-KSJM

September 22, 2022

Page 3 of 5

All communications from December 1, 2021 through August 

22, 2022 between Peiter Zatko or anyone acting on his behalf, 

on the one hand, and Defendants or their Advisors, Lenders, or 

Co-investors, on the other, and any documents reflecting, 

referring to, or summarizing such communications, and

All communications sent or received by Defendants or their 

Advisors, Lender, or Co-investors, from December 1, 2021 

through August 22, 2022 that relate to Zatko or his July 6 

complaint, including any of the allegations contained therein.6

The interrogatory states:

State “yes” or “no” whether, during the period January 1, 2022 

through August 22, 2022, any of Elon R. Musk; Jared Birchall; 

any lawyer of Skadden, Arps, Slate, Meagher & Flom LLP that 

did any work relating to Twitter for any of defendants; any 

lawyer of Quinn Emanuel Urquhart & Sullivan, LLP that did 

any work relating to Twitter for any of Defendants, or any 

employee of Morgan Stanley that did any work relating to 

Twitter for any of Defendants had knowledge, whether directly 

or indirectly obtained from Zatko or any other source, of any 

criticisms, allegation, opinion, or views relating to Twitter that 

were made or held by Zatko or were attributed to Zatko, during 

the period November 1, 2020 through August 22, 2022.7

Defendants initially refused to provide this discovery on the grounds that it was 

requested too late.8 In addition, they objected to the portion of the interrogatory that asks 

for information regarding Morgan Stanley; it is unclear whether they objected to the rest.9 

They initially objected to the document requests on the grounds that they had “no reason 

6 Opposition, Ex F at 1.

7 Opposition, Ex. G at 5.

8 Opposition, Ex. A at 10.

9 Id. at 11.
C.A. No. 2022-0613-KSJM

September 22, 2022

Page 4 of 5

to think” that responsive documents existed.10 Defendants then pivoted to say that 

responding to the documents requests would be “unduly burdensome” to the extent such 

requests covered communications by “Advisors, Lenders, or Co-Investors.”11 Twitter 

clarified its interrogatory and narrowed its document request.12 Defendants again 

objected.13 

It is unclear to me from the correspondence what Defendants are agreeing to 

produce. Any reply filed by Defendants in further support of the Second Motion to Amend 

should clarify their position.

In any event, the Second Motion to Amend is granted. Plaintiff’s request that the 

court allow the amendment subject to conditions relating to discovery concerning the 

amendment is reasonable. I have not yet determined what scope of additional discovery 

should be permitted. The parties shall present argument on the scope of additional 

discovery during the September 27, 2022 hearing.

IT IS SO ORDERED.

Sincerely,

/s/ Kathaleen St. Jude McCormick

Kathaleen St. Jude McCormick

Chancellor

10 Id. 

11 Id. at 7–8.

12 Id. at 6–7; id., Ex. K at 1–2.

13 Opposition, Ex. A at 4–5. 
C.A. No. 2022-0613-KSJM

September 22, 2022

Page 5 of 5

cc: All counsel of record (by File & ServeXpress)