The Fight Between Musk and Twitter Will Come Down to Three Words

Elon Musk’s attempt to walk away from his $44 billion Twitter Inc. buyout will turn on a three-word phrase that’s sometimes asserted in busted mergers — but rarely passes muster with judges.

“Material Adverse Effect” was cited by Musk’s lawyers in a regulatory filing Friday which argued that undisclosed information about bots on the social media platform is “fundamental to Twitter’s business and financial performance.”