September 2022 Business Litigation Update
Whistleblower Alleges Serious Security Flaws,
Negligence, and a Cover-Up
With the Musk-Twitter legal battle scheduled to head to a Delaware courtroom in October, Twitter is suddenly facing a new and potentially devastating legal issue. Last week, a whistleblower came forward alleging major security problems at the social media giant that pose a threat to its users’ personal information, including government agencies, heads of state, and other influential public figures.
The whistleblower is an ex-Twitter executive who made explosive allegations that the company is reckless and mismanaged, running servers with out-of-date software, and allowing too many staff members to access sensitive information without appropriate oversight. Peiter “Mudge” Zatko, the former Twitter security chief, alleges that some of the company’s most senior executives are aware of the security vulnerabilities and have attempted to cover them up.
Zatko also claims that Twitter has knowingly downplayed the level of bot activity on the platform. This was central to Musk’s pretext for backing out of his $44B deal to buy the company. So of course, all of this has caught Musk’s attention. After these claims were made public, his legal team subpoenaed Zatko. He is scheduled to be deposed on September 9.
Musk, of course, hopes these revelations somehow bolster his case and his reasoning for backing out of the deal. But these allegations could have significant negative consequences for Twitter itself. Zatko isn’t just alleging that Twitter has serious security flaws that could expose user information, but that the company is aware of these vulnerabilities, has been negligent in working to correct them, has lied about them, and has even attempted to cover them up.
It is one thing for a company to uncover a security flaw in its on-line platform and then take the necessary steps to correct the vulnerability. It is quite another to knowingly allow vulnerabilities to continue without taking any action. Again, if Zatko’s allegations are proven true, Twitter will be facing potentially serious legal issues with regulators, the public, and its shareholders, in addition to the Musk lawsuit.