A court order could finally shed light on the ownership structure of the popular social media platform X (formerly Twitter).

US District Judge Susan Ilston ruled on Tuesday that the company must provide a list of shareholders by September 4 as part of an ongoing legal proceeding.

This was part of a motion approved by Ilston that would force X to reveal detailed corporate information. The decision will have major implications for the company as its ties to controversial shareholders could become a matter of public knowledge.

These stakeholders will likely be those who aided Elon Musk acquire the platform in October 2022 and the list may include investment funds and venture capitalists.

A Tech Journalist is Responsible for Forcing X to Disclose Who Its Top Backers Are

This mandatory disclosure is part of an ongoing legal fight between X and a group of former employees who were fired by Musk in 2023 after he took over the company. They claim that Musk violated existing agreements including arbitration clauses that required X to pay certain fees if the company was acquired.

The case served as a platform for unexpected third parties who demanded that X reveal this sensitive information.

An independent tech journalist named Jacob Silverman partnered with a non-profit organization called the Reporters Committee for Freedom of the Press and intervened by filing a motion in July to ask the court to unseal these records as a matter of interest for the public.

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The size and vast reach of a social media platform like X and its power to shape the social discourse globally were cited as enough reasons to grant the motion.

The argument of transparency finally persuaded Judge Ilston to approve the request. She also argued that X’s attorneys did little to block the move as they “presented little more than conjecture in support of their position.”

The court order demands a file of unredacted materials to be handed over. X’s attorneys argued that this is not part of the company’s policy as it “does not publish or make publicly available information regarding its owners/shareholders and treats such information as confidential”

X’s legal team tried to resist the disclosure, arguing that revealing the list of investors could undermine the company’s competitive position and give prospective shareholders an unfair advantage.

They emphasized that individuals and entities who invested in a private corporation like X Holdings expected privacy. However, these arguments failed to sway Judge Illston, who found them insufficient to outweigh the public interest of this disclosure.

The judge’s decision highlights the tension between corporate confidentiality and the public’s right to be informed, especially when it comes to platforms that play a significant role in shaping public narratives and spreading news and information.

A Saudi Prince, Jack Dorsey, and Fidelity Are Some of X’s Top Backers

While the full official list is yet to be released, the Washington Post managed to get ahold of the court’s filing.

The document reportedly reveals a total of almost 100 entities that have bought a stake in the social media platform. A Saudi Prince named Alwaleed bin Talal appears to be one of X’s top backers while the founder and former CEO of the social media platform, Jack Dorsey, still owns a portion of the company.

Moreover, prominent Silicon Valley venture capital firms like Sequoia Capital are also included and some celebrities like Sean “P Diddy” Combs are reportedly mentioned as well. From the financial industry, Fidelity appears to be the most prominent backer.

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Although X’s ties with some of these investors were already known before this court order, many of them may have exited the investment or could have acquired a higher stake recently.

It will be very interesting to see how much of the company certain powerful groups own. For example, a high stake owned by Saudi Arabians could result in a higher level of scrutiny by US agencies to investigate if the platform has been favoring the Middle East country’s agendas and interests.

This wouldn’t be much of a problem with most tech companies but X claims to be the online version of a public townhall, favoring free speech. Critics aren’t convinced by this framing as X under Elon Musk has acquiesced to more government censorship requests than it did as a public company. If it is discovered that X is removing criticisms of the Saudi royal family or of any its major investors (like P Diddy), Musk’s talk of protecting free speech will ring hollow and the platform may start to lose users.

The platform has also been found to harbor (likely unintentionally) influence campaigns of various kinds, including a recent targeted campaign on US politicians from the state of Israel.

Moreover, some of these investors may have preferred to keep their ownership percentages in secret. The court’s mandatory disclosure could prompt them to exit their X investment if they feel that this will result in issues with regulatory agencies.

For Musk, this is also not an ideal scenario either as his ties with certain individuals and organizations who helped him complete the acquisition of X will be revealed. Depending on who makes the list, chances are that he will face backlash from someone.

The Value of X Has Been Marked Down by Some of These Investors

The disclosure of X’s investor base also comes at a time when the company could be facing significant financial challenges. Since Musk’s takeover, there have been indications that X’s business has struggled.

Documents leaked earlier this year revealed that X’s value had fallen by more than 70% to around $12.5 billion.

Fidelity reportedly marked down the value of its X shares to somewhere between $15 billion and $16 billion. Meanwhile, X has seen its advertising revenue plummet after Musk’s takeover, with many large advertisers fleeing the platform.

In addition, Musk borrowed $13 billion to acquire the social media company. These loans generate annual interest payments of $1 billion and lenders have had no alternative other than trusting Musk’s promises as they have been unable to sell the debt to third parties.

These financial challenges provide important context for the court-ordered disclosure, as they may impact investor sentiment and the overall perception of X’s value and feasibility.

The federal judge’s order for X to disclose its list of largest shareholders marks a significant moment in the company’s history.

It represents a victory for transparency advocates and could set a precedent for other major private tech companies. As X prepares to comply with the court order, a large group of people will be eagerly awaiting the full revelation of who exactly owns one of the most influential communication platforms of our time.

The coming weeks will undoubtedly bring further analysis and debate as the full investor list becomes public and could potentially reshape our understanding of the influential role that certain groups may have on X’s content moderation policies and other critical aspects of the platform.