Earlier this year when Facebook announced that they would be acquiring Instagram, it was reported that Twitter had initially been interested in the acquisition as well, with Facebook beating them to the punch. However according to recent reports, it seems that Twitter had offered Instagram $525 million to acquire them, before Facebook beat them out with a $1 billion deal. Given that this was a while ago, why mention it now? Sure we’ve heard of deals that almost went through, but this time it looks like this near-deal could result in some legal trouble.

In an effort to speed up the acquisition, Instagram’s CEO Kevin Systrom testified in front of the California Corporations Department, stating that the company did not receive any formal offers or term sheets from other companies apart from Facebook. If the recent reports are to be believed, it seems that Instagram’s CEO and Twitter had a verbal agreement, but backed out claiming he wanted Instagram to remain independent. It seems that he was even given a term sheet which is basically the outline of the formal deal, but it seems that he never kept it.

All of this is assuming the reports (via the New York Times) are true, and if they are, it is up to the California Corporations Department to decide if they wish to move forward and launch an investigation. However according to the Department, they tell Nick Bilton of the NY Times that they have yet to receive any reports of complaints or protests regarding the proceedings. While the deal was made pretty quickly, we guess it might not be as cut and dry as we thought after all.

Filed in Photo-Video >Rumors. Read more about Facebook, Instagram and Twitter.

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