In April 2022, Elon Musk made a bid to buy Twitter offering USD 54.20 a share and vowing to loosen the company’s policing of content and root out fake accounts. Since then, however, the social media giant and the world’s richest man have been locked in a legal battle, as Musk claimed that Twitter breached several provisions of the acquisition and therefore, he would want to back out of the deal. Amidst the claims and counterclaims, Twitter filed its response on Thursday in Delaware Chancery Court, attempting to debunk the claims made by Elon Musk, explaining how Twitter failed to live up to acquisition terms.
While most of the filing by Elon Musk and the response by Twitter focussed on Musk’s foremost reason to back out from the deal – Musk saying that Twitter failed to disclose the number of spam accounts and bots that infest Twitter – there was a portion where Elon Musk had also taken umbrage to the big-tech company picking a battle with the Indian government.
On June 5, social media giant Twitter approached Karnataka High Court against the Government of India’s orders to take down some content and handles from its platform over violation of the law. Twitter cried abuse of power by the GoI officials in its plea to the court.
Twitter claimed in its plea that some of the removal orders did not fulfil the procedural requirements per the IT Act. It claimed that some of the orders were related to the content posted by the official handles of political parties, and blocking such content would amount to a violation of freedom of speech.
While Twitter made these claims, it is pertinent to note that some of the accounts that were withheld or some content of the accounts were withheld by GoI orders include alleged journalist Rana Ayyub, pro-Khalistani author Aman Bali, pro-Khalistani activist Ravi Singh who is also the founder of Khalsa Aid and more. In these cases, the Indian government had issued take-down notices because it affected national security and content that incited violence or terrorism within the country cannot be broadcast according to the laws of the land.
Elon Musk vs Twitter: Twitter’s battle with India finds mention in court filings
In his filing that Twitter has now responded to, Elon Musk said that Twitter had initiated risky litigation against the Indian government thereby placing its third largest market at risk.
In para 18, Elon Musk says, “These obfuscations and misrepresentations are not Twitter’s only sins. Since the Merger Agreement was signed, Twitter has also made significant changes to its business without obtaining the consent required by the Merger Agreement. Twitter has terminated its product lead and another key executive, retained a board member whose reelection was rejected by stockholders, instituted a hiring freeze, and disobeyed orders from and initiated risky litigation against the Indian government—thereby placing Twitter’s third largest market at risk”.
In its response, Twitter responds to the allegations of termination of employees and making significant changes to the business without taking the consent required by the merger acquisition. The social media giant admitted that it terminated certain employees, and declined the accept the resignation by board members but rejects the allegation that it initiated a hiring freeze. In its response, it also accepts that it initiated litigation against the Indian government, however, says that it did not need Elon Musk’s permission to initiate any of these decisions. In a generic response, Twitter simply “denied allegations in Paragraph 18”.
Further, in para 181, Elon Musk asserted that Twitter failed to disclose the litigation against and the investigation into Twitter by the Indian government, saying, “In 2021, India’s information technology ministry imposed certain rules allowing the government to probe social media posts, demand identifying information, and prosecute companies that refused to comply. While Musk is a proponent of free speech, he believes that moderation on Twitter should “hew close to the laws of countries in which Twitter operates.””
Twitter in its response claimed, “The first sentence of Paragraph 181 purports to characterize rules promulgated by the Indian government, to which Twitter respectfully refers the Court for their complete and accurate contents. Twitter lacks knowledge or information sufficient to form a belief as to the truth of the allegations in the second sentence of Paragraph 181 and therefore denies them on that basis”.
In what appears to be an attempt to willfully obfuscate, Twitter claims that the first part of the assertions in para 181 (which talks about the rules promulgated by India), “characterises rules promulgated by the Indian government” and therefore, it merely asked the court to refer to the documents for the “accurate contents”. In this part of its response, Twitter almost tries to mislead the court by insinuating that the characterisation of the laws promulgated by India are somehow untrue by Elon Musk, however, that is untrue. In the second part of its response, it merely says that Twitter “lacks knowledge or information sufficient to form a belief as to the truth of the allegations and therefore denies them on that basis”. The claim is that Elon Musk believes that while free speech is important, Twitter must adhere to the laws of the lands in which it operates. From this response, it is unclear what assertion Twitter is rejecting in the first place. Perhaps, it is saying that it does not believe in following the laws of the land in which it operates, which becomes an issue that the Indian government then must look into.
In para 182, Elon Musk says that Twitter has faced various investigations by the Indian government.
Twitter, in response, says that all their interaction with the Indian government has been reported widely by the media and has also been documented in Twitter’s own transparency disclosures. What is telling, however, is that Twitter characterises the laws of India to be “restrictive” in its response, which is patently false. Indian laws do not restrict free speech in any manner, however, when India’s national security, integrity and law and order are at stake, India is bound to ask Twitter to take down such content. In fact, these are the very reasons cited by Twitter when it banned sitting President Donald Trump from its platform for life. The responses by Twitter only go to show that it has little respect for the laws of India and in the filing, Elon Musk seems to point that out repeatedly.
Twitter in its response has also rejected the claim that India is the third largest market for the social media giant, in an attempt to discredit the serious lapse that was pointed out by Elon Musk in the preceding paras. In para 183, Elon Musk asserts that the investigation by India could disrupt services in the Indian market, an assertion that Twitter rejected.
In para 184 and 185, Elon Musk goes further and claims that Twitter did not disclose the investigation by the Indian government to him, as per the requirements of the acquisition agreement. Musk further said that Twitter filed a case against India on or around the 6th of July 2022, which would mean that Twitter was under investigation when the merger agreement was signed, and therefore, it failed to disclose required information to Musk at that time.
Twitter, in its response, seems to cite a technicality saying that Section 4.11 of the agreement did not require it to disclose the company’s interaction with the Indian government to Elon Musk while admitting that it did not disclose the investigation to Musk. Interestingly, if the merger agreement required Twitter to disclose any litigation and investigation against the company to Musk, citing a technicality that it specifically did not require it to disclose interaction with the Indian government might not fly in the court of law.
For para 185, Twitter responded, “Twitter admits that it brought a legal challenge against the Indian government and respectfully refers the Court to its July 5, 2022 petition to the Karnataka High Court. Twitter avers that it has challenged certain blocking orders issued by the Indian government under Section 69A of the Information Technology Act, directing Twitter to remove certain content from its platform, including content from politicians, activists, and journalists, and that Twitter’s legal challenge is contemplated by the law itself, which allows companies or persons to challenge government blocking orders. Twitter further avers that its legal challenge is consistent with its global practice of challenging government requests or laws where such requests are not authorized or properly scoped under local law, are procedurally deficient, or as necessary to defend its users’ rights, including freedom of expression. Twitter otherwise denies the allegations of Paragraph 185, including the allegation that its legal challenge is related to any “investigation” by the Indian government”.
Twitter in this response seems to hide under the garb of “global practises” and “freedom of expression”. Interestingly, it fails to mention that in its own transparency report, there are several countries ahead of India in its legal demands. India constituted only 8% of total legal demands against Twitter. As far as the request for information on Twitter users is concerned, the USA topped the list with 20% request. As far as a request to remove content from Twitter is concerned, Japan topped the list with 30% of total demands and India came 5th with only 8%. In most of these responses, Twitter makes it seem as if India is the top contributor and is enforcing “restrictive laws”, however, their own transparency report does not verify that claim. Twitter and the media in this case have been reductionist at best trying to interpret the data transparency report by Twitter and the misplaced conclusions have been used to launch a tirade against India.
In fact, this is the very fact pointed out by Elon Musk in the next para.
In para 190, Elon Musk points out that its combative stance with the Indian government was a “departure from the ordinary course” since it had followed obligations from Russia, including blocking pro-Ukraine accounts. It is pertinent to note here that Russia is ahead of India in takedown requests according to Twitter’s own transparency report.
Twitter responded, “Twitter admits that it filed suit to challenge certain blocking orders by the Indian government. Twitter further avers that, in its continuing effort to make its services available to people everywhere, if it receives a valid and appropriately scoped request from an authorized entity, it may withhold access to certain content in the specific jurisdiction that has issued the valid legal demand or where the content has been found to violate local laws, but that it routinely pushes for limitations on, objects to, or otherwise challenges government requests or laws where such requests are not authorized or properly scoped under local law, are procedurally deficient, or as necessary to defend its users’ rights. Twitter otherwise denies the allegations in the first and second sentences of Paragraph 190. Twitter denies the allegations in the third sentence of Paragraph 190. Twitter lacks knowledge or information sufficient to form a belief as to the truth of the allegations in the fourth sentence of Paragraph 190 and therefore denies them on that basis. Twitter denies the allegations in the fifth sentence of Paragraph 190”.
Twitter clearly skirted the important point raised by Elon Musk – if it agreed to politically motivated requests to remove pro-Ukraine accounts, that clearly had an impact on their freedom of speech, why did it pick a legal battle with India and was it not out of the ordinary for it to do so.
In two other paras, Elon Musk asserts that Twitter’s course of action with the Indian government was incorrect and out of the ordinary.
In para 195, Elon Musk clearly indicates that action against the Indian government was “out of the ordinary course” for Twitter and his permission should have been sought.
Next, in para 221, Musk says that Twitter breached the provisions of the acquisition by not taking the consent of the buyer before initiating litigation in India and refusing the orders of the Indian government (apart from other considerations like firing 30% of the workforce, instituting hiring freeze etc).
Twitter, in its inimitably evasive style, simply responded with “denied”.
In the filing by Elon Musk and the responses given by Twitter, it is evident that information is being selectively by Twitter to tarnish the image of India, however, it is also apparent that while Musk supports free speech, he considers Twitter’s conduct with India “out of the ordinary” since it conceded to demands by Russia to block pro-Ukraine accounts as well, clearly, not adhering to their espoused principle of upholding free speech. It is pertinent to note that Twitter has not initiated any litigation against Japan or Russia, which score higher than India in their take-down requests. Elon Musk has repeatedly asserted that Twitter’s action against India risks its stakes in the country. This viral information that emerges from the filing could clearly be used by the Indian government to assert how Twitter has conceded to far more problematic requests by other nations like Russia, however, is grandstanding and trying to undermine Indian national interest by rejecting the laws of India.
Indian government and the new IT guidelines
In February 2020, The central government issued fresh guidelines for social media and OTT platforms. The government said that these guidelines were being introduced to “establish a soft touch progressive institutional mechanism with a level playing field featuring a Code of Ethics and a three-tier grievance redressal framework for news publishers and OTT platforms on the digital media”.
The guidelines that were issued by the central government had several provisions and a code of ethics for the functioning of OTT platforms, Digital News websites and Social Media behemoths like Twitter, Facebook etc.
One of the most significant provisions of these guidelines is that if the social media platforms don’t comply with the provisions prescribed in the guidelines, this will attract penal provisions as per the Information Technology Act. The new guidelines say that the social media intermediaries must follow the due diligence mentioned in it, and if any intermediary does not follow the due diligence, the safe harbour provisions will not apply to them.
The section 79 of the Information Technology Act defines this safe harbour, which basically makes them not liable for any content posted by users on their platforms. It says that an intermediary shall not be liable for any third-party information, data, or communication link made available or hosted by them, provided they themselves didn’t initiate such communication, and observes due diligence under the IT act.
Now, this due diligence to be observed by the social media companies have been defined in the new guidelines. It includes various measures they have to perform, like identifying the first originator of any information that appears on social media, not allowing content that is defamatory, obscene, pornographic, paedophilic, inciting violence, against national integrity, misleading, false etc. The platforms also have to remove any such content within 36 hours of receiving a court order or a government direction to remove such content.
According to the guidelines, if the social media sites allow such objectionable content to be hosted on their platforms, and don’t remove them even after receiving such orders from courts or the government, it will mean that they are not observing due diligence. As a consequence, they will lose the safe harbour in the IT Act that isolates them from content posted on their platforms.
This means, if the social media companies do not comply with the guidelines, they will be held responsible for any content which is not allowed as per the guidelines. And, the officials of the social media companies will be liable to be prosecuted for such content. This implies that the social media officials will also be punished according to the nature of the offence, which is defined in the IT Act for various kinds of offences. The punishment defined in the act includes imprisonment for three years for most offences, but life imprisonment for some like cyber terrorism, and also includes fines of various amounts.
When the IT guidelines were issued, one of the most important compliance requirements imposed on social media companies was the grievance redressal mechanism that they had to put in place.
Following are the guidelines related to the appointment of grievance officer and the redressal mechanism they were required to put in place:
- Social media intermediaries shall register the grievance within 24 hours and dispose of the complaint within 15 days.
- The Intermediaries will have to publish a compliance report once a month where they detail the complaints they received and how they redressed the complaint.
- The resident grievance officer shall perform all functions under the grievance redressal mechanism.
- All grievance officers should have a physical address and that address should be published on the website and the mobile app.
- The person appointed as the chief compliance officer shall be a resident of India.
- The nodal contact person will be responsible for 24×7 coordination with Indian law enforcement agencies.
It is pertinent to note that Twitter has breached almost all of the provisions in the IT guidelines that were enforced by the Indian government. One can read a primer on how social media behemoths were rampantly breaching the law to institute a grievance redressal system here.
With Twitter locked in a battle with India, the points raised by Elon Musk could be significant and it remains to be seen if Twitter’s policy with regard to India sees a shift after the court case in the US.