TWTR - Musk cites whistleblower security issues as he looks to escape Twitter deal

Billionaire Elon Musk leaned heavily on whistleblower claims in his amended counterclaims against Twitter ( NYSE: TWTR ) - his full-bore attempt in court to escape a $44B deal to acquire the company and take it private.

After being permitted to add claims from Twitter's former security executive Peiter "Mudge" Zatko to his counterclaim, Musk filed his amendment under seal with the Delaware Court of Chancery on Friday .

The public version of the counterclaim has been released , and from the outset it's advancing an altered argument for canceling the deal beyond Musk's claims that Twitter's "key metric" - monetizable daily active users - was misrepresented due to false and spam accounts.

"Stunning events over the last week, however, have revealed that the misrepresentations regarding mDAU were only one component of a broader conspiracy among Twitter executives to deceive the public, its investors, and the government about the dysfunction at the heart of the company," Musk's new counterclaim begins.

"In what can only be described as one of the most significant whistleblower complaints in recent history," Zatko submitted his 84-page whistleblower report, outlining a series of explosive disclosures regarding misconduct within Twitter," Musk's team says.

In response, Musk says that Twitter did exactly what it did to Musk: "Ignored and concealed the problems and attacked the messenger."

The new revelations "make undeniably clear that the Musk Parties have the full right to walk away from the Merger Agreement — for numerous independently sufficient reasons. In short, the Musk Parties and Twitter’s many other investors were sold a different company than the Twitter that actually exists — one that was more valuable, more popular, more secure, and more compliant with governing law."

Twitter shareholders gave their approval to the $44B acquisition Tuesday, with 98.6% of votes cast giving the OK .

Under ordinary conditions - and these are no ordinary conditions - the deal would be set to have closed as of Thursday (48 hours after the shareholder vote). But it's stayed pending the Delaware litigation.

The shareholder vote is a prominent milestone just the same: A settlement under different deal terms would mean going back to the shareholders, and if Musk indeed ends up forced to buy the company, he might be on the hook for interest.

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