'Competition Is Fine, Cheating Isn't,' Says Elon Musk As Twitter Threatens to Sue Meta Over Its New Threads App

Twitter's parent company, X Corp., is considering legal action against Meta following the launch of its new Threads app on July 6. A prominent Silicon Valley legal firm representing X Corp. has accused Meta of engaging in the unlawful misappropriation of Twitter's trade secrets and intellectual property by hiring its former employees.

According to HuffPost, Threads, a text-based competitor to Twitter, was introduced as a companion app to Meta's Instagram, and some industry observers speculate that it could pose a serious threat to Twitter's dominance.

The chaos after Elon Musk's Twitter takeover

The controversy surrounding Threads comes in the wake of Elon Musk's takeover of Twitter, which resulted in massive layoffs and the departure of numerous employees. It appears that some of these former Twitter employees have found employment at Meta, as indicated in the letter addressed to Meta CEO Mark Zuckerberg. Meta is the parent company of Facebook, Instagram, WhatsApp, and several other tech platforms.

Meta denies wrongdoing

In response to the accusations, Meta has vehemently denied any impropriety. Company spokesperson Andy Stone stated that none of the engineers on the Threads team were former Twitter employees. Meta maintains that the allegations of deliberate misappropriation of trade secrets and intellectual property are unfounded.

Allegations against Meta

The letter sent to Zuckerberg alleged that Meta intentionally assigned former Twitter employees to develop the Threads app, using Twitter's trade secrets and intellectual property to expedite its development. The letter claimed that this violated state and federal laws, as well as the employees' ongoing obligations to Twitter. It also instructed Meta to preserve any relevant documents pertaining to the dispute.

Elon Musk's response

Elon Musk, in a tweet addressing the legal threat, stated, "Competition is fine, cheating is not." Musk's statement suggests that he supports healthy competition but condemns any unfair practices that may undermine it.

Twitter's struggle to retain users

Internal company records obtained by Reuters in October 2022 revealed that Twitter has been struggling to retain active users. Last July, the user count exceeded 200 million, according to The New York Times. However, under Musk's leadership, Twitter became a private company and is no longer obligated to disclose such information publicly.

Zuckerberg's ambitions for Threads

Mark Zuckerberg expressed his desire to see Threads reach a user base of 1 billion before considering monetization. Threads garnered over 30 million sign-ups within a short period, surpassing other platforms with the potential to challenge Twitter's dominance, such as Mastodon and Bluesky.

Viability of Twitter's legal threat

While Twitter's legal threat against Meta may seem significant, it may ultimately be perceived as hollow due to Twitter's own financial struggles. Recent months have seen Twitter accused of neglecting its financial obligations, including failing to pay arbitrators' fees in nearly 900 disputes filed by former employees. Consequently, the threat of expensive legal action from Twitter may not carry substantial weight.

Zuckerberg and Musk's metaphorical clash

Zuckerberg appeared to view the launch of Threads as a symbolic match against Elon Musk. In response to users on Threads who mentioned a potential fight between the two tech giants, Zuckerberg replied with crying-laughing emojis. He emphasized that this was only the beginning and likened it to the first round of a cage match between himself and Musk.