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According to the article "Other emails obtained by The Times show Mr. Fletcher treated the incident as a bounty and encouraged Preacher to provide proof of the vulnerability, including sending a few lines of data from the database he had breached."

So no, this was not disqualifying and he was told to do so. This is not extortion, just pay negotiations.

alternately: your read on it is precisely why he phrased the email this way, understanding the gravity of the situation and hedging if the email conversation ever became public.

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