X has lost a legal fight in Australia in which the company tried to avoid a $400,000 fine by claiming that Twitter no longer exists. The creative legal argument, first spotted by ArsTechnica, came amid a more than year-long dispute with Australia’s eSafety Commission.
The commission had asked the company, then known as Twitter, to provide details about its handling of child sexual exploitation on the platform last February. In its response, X failed to answer a number of questions and left “some sections entirely blank,” the commission said in a statement last year. As a result, the eSafety Commission slapped the company with a more than $415,000 fine for non-compliance.
It was an attempt to fight that fine that led to X’s claim that it shouldn’t be responsible since Twitter had “ceased to exist.” From the court filing:
X Corp submitted that, on and from 15 March 2023, Twitter Inc ceased to be a person, and therefore ceased to be a provider of a social media service. It was submitted that Twitter Inc therefore lacked capacity to comply with the notice, and that X Corp was not obliged to prepare any report in Twitter Inc’s place, as X Corp was not the same person as the provider to whom the notice was issued.
The argument isn’t exactly new for the Elon Musk-owned entity. CEO Linda Yaccarino has also repeatedly claimed that X is a “brand new company” in a bid to avoid scrutiny. She repeated the line multiple times earlier this year while testifying at a Senate hearing on child safety issues.
Australia federal Judge Michael Wheelahan, however, found the claim unconvincing, saying that X’s argument required “leaps in logic that were not supported by adequate explanation.” X didn’t immediately respond to a request for comment.
In a statement, eSafety Commissioner Inman Grant cheered the decision. “Had X Corp’s argument been accepted by the Court it could have set the concerning precedent that a foreign company’s merger with another foreign company might enable it to avoid regulatory obligations in Australia,” Grant said.
Source: www.engadget.com