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Elon Musk’s Twitter trial delay request denied, but addition of whistleblower complaint gets approval
Elon Musk’s request to delay his trial against Twitter has been denied by a Delaware court. However, Musk’s request to include the claims put forth by whistleblower and former Twitter security chief Peiter “Mudge” Zatko in his countersuit against the social media company has also been approved.
The ruling was outlined by Chancellor Kathaleen McCormick in a letter. With this in mind, Elon Musk has gained a small win and a loss in his initial session with Twitter in court. Musk’s legal team had requested to push the trial back to mid-November, but with the rejection of the request, the trial is still expected to begin on October 17, 2022.
“Defendants’ motion to extend the case schedule is denied… In arguing that trial should be delayed by at least four weeks, Defendants contend that no external deadline creates any urgency. They observe that the merger agreement’s “termination date of October 24, 2022is automatically stayed if litigation is commenced, and debt financing has an outside date of April 25, 2023.”
“They adduce, therefore, that ‘any prejudice to Twitter can be easily mitigated by . . . continu[ing] the trial date.’ But the opposite is true. I previously rejected Defendants’ arguments in response to Twitter’s motion to expedite, making clear that the longer the delay until trial, the greater the risk of irreparable harm to Twitter. Indeed,Twitter has represented that the anticipated risk of harm has materialized over the course of this litigation.
“Twitter ‘has suffered increased employee attrition,’ which ‘undermin[es]the company’s ability to pursue its operations goals. The company has been forced for months to manage under the constrains of a repudiated merger agreement, including Defendants’ continued refusal to provide any consents for matters under the operating covenants. ‘I am convinced that even four weeks’ delay would risk further harm to Twitter too great to justify,” McCormick wrote.
But while Musk’s efforts to delay the trial were unsuccessful, the Tesla CEO’s efforts to augment his countersuit with former Twitter security chief Peiter Zatko’s whistleblower complaint were successful. Zatko had accused Twitter of fraud while also noting that the social media company did not really care to find out how many of its users were spam or fake accounts. Twitter, for its part, has been dismissive of Zatko’s whistleblower complaints.
Twitter lawyers, during their session in a Delaware Chancery court on Tuesday, claimed that Zatko’s accusations do not meet the legal standard to nullify its merger contract with Musk even if they were true. Twitter’s legal team also noted that while Zatko did raise security concerns during his tenure with the company, Twitter investigated the issues internally and found that the security chief’s concerns were “without merit.”
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McCormick, however, does not seem to agree with Twitter’s legal team on the issue.
“Defendant’s motion to amend is granted… The newly published Whistleblower Complaint would be grounds in most instances to permit an amendment under the low bar of Rule 15(a). Twitter argues that the amendment would be futile, but their arguments falter against the exceedingly movant-friendly standard of Rule 15(a). I am reticent to say more concerning the merits of the counterclaims at this posture before they have been fully litigated. The world will have to wait for the post-trial decision.
“Twitter also argues that the amendment would be prejudicial to the extent it would expand discovery and extend the case schedule, and Twitter’s arguments to this effect are far more forceful than Twitter’s futility arguments. But that prejudice can be mitigated by cabining additional discovery to the new allegations and maintaining the existing case schedule. So that is what I will do,” McCormick wrote.
Chancellor Kathaleen McCormick’s letter can be viewed below.
Letter Decision Resolving Defendants' Motion for Leave to Amend and Extend Case Schedule (003) by Simon Alvarez on Scribd
Don’t hesitate to contact us with news tips. Just send a message to simon@teslarati.com to give us a heads up.
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SpaceX COO Gwynne Shotwell outlined ambitious plans for Starlink Mobile during the company’s August 4 Earnings call, signaling a direct challenge to U.S. wireless giants like AT&T, T-Mobile, and Verizon.
Shotwell noted that the three companies generate roughly $600 billion in combined annual revenue. “I anticipate us to be able to acquire quite a few of their customers because I think our service will be better,” she said. “We will eliminate dead zones leveraging the satellites in orbit. It will be better during any natural disaster… I’m quite excited about Starlink Mobile.”
SpaceX President & COO Gwynne Shotwell on @Starlink Mobile and its impact on Verizon, AT&T and T-Mobile:
“Roughly, between them, $600 billion a year. I anticipate us to be able to acquire quite a few of their customers. Our service will be better. We will eliminate dead zones… pic.twitter.com/UYZUkrGc0L
— Sawyer Merritt (@SawyerMerritt) August 4, 2026
SpaceX intends to combine its satellite constellation with terrestrial infrastructure. The company has acquired about 65 MHz of spectrum from EchoStar and plans to deploy next-generation Starlink Mobile satellites in 2027, with upgraded service targeted for the end of that year.
Shotwell described the enhanced network, leveraging more satellites and spectrum, as potentially “100 times better” than the current direct-to-cell offering, which already supports basic texting and app-based voice/video in coverage gaps through partnerships. She also indicated plans for low-cost cellular base stations that could integrate with existing Starlink dishes, creating a hybrid system for broader capacity in urban, suburban, and rural areas.
For the general public, Starlink Mobile promises significant advantages. Satellite connectivity can fill gaps where traditional cell towers fail, delivering service in remote locations, mountains, or during outages caused by storms, wildfires, or infrastructure damage—conditions in which ground networks often collapse.
Users could enjoy more consistent coverage without relying solely on dense tower builds, potentially at competitive prices as SpaceX scales. The hybrid approach aims to support full mobile services, including higher-speed data, while working with unmodified smartphones over time.
These developments revive long-standing but unfounded rumors of a Musk-developed “Tesla phone.” Speculative claims of a “Pi Phone” or similar device with built-in Starlink connectivity have circulated for years on social media, often featuring fabricated images and details. Elon Musk has repeatedly denied any such plans, stating Tesla has no intention of entering the smartphone market unless forced by extreme circumstances with app stores.
No official product, filings, or development announcements have ever materialized; the rumors remain hoaxes.
The announcement quickly pressured telecom stocks. Shares of AT&T, Verizon, and T-Mobile fell between roughly 2 and 4 percent in after-hours and premarket trading as investors weighed the competitive threat from a hybrid satellite-terrestrial network.
While execution challenges remain—spectrum deployment, infrastructure rollout, and regulatory hurdles—Shotwell’s remarks mark SpaceX’s clearest signal yet of entering the consumer mobile market as a full competitor.
Venture capitalist Chamath Palihapitiya has cautioned investors shorting SpaceX shares, drawing a direct parallel to the intense short-selling pressure Tesla faced in its early public years.
Responding to reports of elevated short interest in the newly public rocket, satellite, and AI company, Palihapitiya noted that similar dynamics played out with Tesla, where aggressive short sellers ultimately “went broke.”
SpaceX (NASDAQ: SPCX) went public on June 12, 2026, in the largest IPO on record, pricing at $135 per share. Shares quickly surged to an all-time high of $225.64 just days later, briefly implying a valuation exceeding $2 trillion. The stock has since retreated sharply amid valuation concerns, lockup expiration fears, and broader market dynamics.
By early August, it traded near $108–$125, representing a roughly 50 percent decline from the peak and bringing the market capitalization closer to the $1.5–1.7 trillion range. On August 4, shares closed up more than 9 percent at $125.33 ahead of earnings before facing pressure in after-hours and premarket trading.
Short interest has climbed dramatically. According to S3 Partners data widely cited in market reports, short positions reached approximately 219.3 million shares by late July, about 34 percent of the limited public float of roughly 640 million shares, and represented a notional value of around $24.6 billion.
Utilization of shares available to borrow hit 95 percent, with borrow fees rising. This level of shorting exceeded the dollar value of short bets against Tesla at the time and built rapidly ahead of two catalysts: the company’s first post-IPO earnings and an August 6 lockup expiration that could free up to 911.5 million additional shares.
CEO Elon Musk has issued warnings of his own. In mid-July, as short interest approached one-third of the float, he posted that “the survival probability of firms who maintain a significant short position in SpaceX over time is very low,” reiterating his view that the company could ultimately be worth more than Earth if it achieves its goals.
On August 4, just before earnings, Musk responded to the latest short-interest data by saying, “I try to warn them, but they just double down.”
SpaceX delivered its first quarterly results as a public company after the close on August 4. Second-quarter revenue rose 92 percent year-over-year to $7.8 billion, beating consensus estimates near $6.8–6.9 billion.
The net loss narrowed to $541 million, or 9 cents per share, better than the roughly 23–24 cent loss expected. Starlink/connectivity contributed about $4.3 billion (up 66 percent), while the AI business generated $2.6 billion (up roughly 250 percent). Capital expenditures were heavy at $18.4 billion, largely tied to AI infrastructure. Management projected a $100 billion annualized revenue run rate by year-end 2026 and outlined a path toward $1 trillion in annual revenue by 2030.
The combination of Chamath’s historical reminder, Musk’s repeated alerts, and the company’s ambitious growth targets underscores the high-stakes debate surrounding SPCX. Short sellers are positioned for near-term supply pressure from the lockup, while long-term bulls point to Starlink scale, Starship progress, and AI compute expansion as reasons the bears may ultimately face the same fate as many early Tesla skeptics.
Investor's Corner
SpaceX and Nvidia team up on Musk’s orbital AI bet
SpaceX revealed a new Nvidia satellite partnership, then Musk pledged an exclusive Nvidia hardware commitment.
SpaceX and Nvidia are now working together on the hardware that will power Musk’s orbital data center ambitions. SpaceX announced on X on Tuesday that it is partnering with Nvidia to design the compute payload for Starmind AI1, the first satellite in a planned constellation built to run AI workloads directly in orbit. Each Starmind satellite will carry Nvidia’s Rubin GPUs and Vera CPUs, according to the post, which included renderings of the payload design.
The announcement landed hours before SpaceX’s first earnings call as a public company, where Musk went further, saying the company has committed to building its AI infrastructure exclusively on Nvidia hardware. “We think the Vera Rubin architecture is the best architecture. We think it’s the best AI computer, and we greatly value our close cooperation and partnership on many levels with Nvidia,” Musk told investors on the call,. “So we’re exclusive to Nvidia.”
Musk said SpaceX plans to deploy Nvidia’s Vera Rubin NVL72 rackscale system, codenamed Kyber, both on the ground and in space. He set a target of 2 gigawatts of compute capacity online by the end of this year, scaling to roughly 10 gigawatts by the end of 2027.
SpaceX’s newest Starmind will make earth data centers obsolete
Starmind has been in development since Musk confirmed the name in June, following an xAI trademark filing that tipped off the project before SpaceX made it official. The idea is massive in scope and instead of moving data down to ground based servers, satellites equipped with onboard processors and large solar arrays would compute AI workloads in orbit and beam results back to Earth. SpaceX has already filed with the FCC for a constellation of up to one million satellites to support the effort, citing constant solar power and the absence of zoning restrictions as advantages over terrestrial data centers.
The Nvidia exclusivity marks a shift in tone from just two weeks ago, when Musk was busy knocking down a report that SpaceX had ordered $52 billion worth of Nvidia GPUs through Foxconn, calling it fake news at the time. The dollar figure in that rumor may have been wrong, but the underlying direction seems correct. SpaceX’s AI division already leases Colossus compute capacity to Anthropic and Google, and Tuesday’s earnings report showed AI revenue climbing sharply as those deals ramp up.
Nvidia shares rose roughly 3% in Tuesday trading on the news, while SpaceX stock climbed nearly 9% during the day before giving back gains after hours as investors digested the earnings report’s capital spending figures.
SpaceX is coming for wireless giants with Starlink Mobile
SpaceX shorts get warned by Musk ally, echoing Tesla’s early struggles
