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Confiscating Tesla shares is 1 of the 4 ways the court could force Elon Musk to comply with orders

TLDR: According to Robert Miller, a law professor, there are 4 ways to “force” Elon to comply to the $Twitter(TWTR.US)$ deal if the judge ruled that he have to purchase Twitter.
1. “Special Master” can be appointed to “replace” Musk and complete the deal.
2. Take over Musk’s $Tesla(TSLA.US)$ shares and use that as payment to Twitter.
3. Fine Musk $millions per day until Musk complies with the request.
4. As a last resort, send Musk to jail.

Disclaimer: Before we start expanding our knowledge, I must first say that this piece does not implies that Twitter will win, or Elon will win. I know some fanboys are ready to pounce given the chance LaughLaugh. Today these power might help Twitter but tomorrow these same power might help Tesla. These powers are fair, it doesn’t care who you are, it is there to help the victims.
Whatever I say or any other people say hold no water because we aren’t legally trained. Therefore, I tend to heed advice from legal expert instead. Here is just some notes taken from legal experts, sharing it to improve our knowledge of how the world is really like.
Story time
As the Twitter v Musk saga continues, there have been many opinions on the matter, and one of the most contested discussion is about whether the Delaware Court of Chancery have any power to force Musk to comply if he does not want to.
Using common sense, courts must have such power right? Otherwise, murderers can go scot-free just by saying “no I don’t want to”. Businesses who violate laws and sanction can just walk away from their wrong doings just by saying “no I don’t want to”. I guess that is why there is this thing known as “contempt of court”.
But what do I know? I only studied a few modules on business law that’s all. I’m not a lawyer, I don’t have law degree nor pass the bar exam. That’s why I have been looking around and tried to understand what power the Delaware Court of Chancery have to enforce compliance. From what I have gathered there are 4. These are according to Robert Miller who is a law professor with extensive experience in mergers and acquisitions and related laws in Delaware Court of Chancery.
These power applies to all cases, meaning if Elon were to sue another company for similar cases, these help Elon too.
1. “Special Master” can be appointed to “replace” Musk and complete the deal
A “Special Master” is a person who has the power to sign documents and hand over property on behalf of an individual or entity that is refusing to comply with court orders. Which means whatever this “Special Master” does, within the scope of the case, is treated as though Elon Musk did it.
2. Take over Musk’s Tesla shares and use that as payment to Twitter
The court can also take control of Musk’s Tesla shares and use it to either acquire Twitter for $44b, or pay Twitter billions of dollars in damages. As both Tesla and Twitter are incorporated in Delaware, the court can treat Tesla’s shares as property and thus seized it and give it to Twitter.
This case won’t be good for Tesla investors because this could cause a selling pressure if Twitter gets the shares and start dumping them, or if the market fears that Twitter will dump the shares.
3. Fine Musk $millions per day until Musk complies with the request
The court can also issue a daily fine on Musk until he complies with the court order. Just last year, TransPerfect was fined $30k per day until it complied with the court’s order.Miller thinks that if it is for Elon Musk, the daily fine can be up to tens of millions of dollar daily.
Since most of Musk’s assets are in Tesla shares and he said he had to sell Tesla shares to pay his taxes before, then he might have to do the same to pay the fines.
4. As a last resort, send Musk to jail
If Musk repeatedly refuses to comply with the court order, the court can hold him in contempt of court which will land him in jail. However, given point 1 to 3, I highly doubt this will happen. Unless he starts tweeting some crazy stuff that could be seen as in contempt of court, then that is another story.
Conclusion
The Delaware Court of Chancery seems to have a lot of power and tools to “force” people (not just Elon, but everyone) to comply to the law. This is fair as no one will want to live in the world where the law does not work on the rich and powerful AngryAngry.
However, regardless of what power the court has, the most important part is for the judge to first determine if Elon have the rights to back out of the deal or if he have to close the deal regardless. If the ruling is in favour of Twitter, I’m sure Musk will file for an appeal which could drag the case longer, but it won’t be years as the Delaware Court of Chancery is renown for closing complex M&A cases in a few months.
October 2022 will be exciting CheerleadCheerlead!!

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