Twitter was reported to have offered $535 million to Instagram last March. This was prior to the $1 billion deal offered by Facebook Inc (NASDAQ:FB), which was accepted by Instagram. Now the CEO of Instagram, Kevin Systrom is under fire.

In a report from the New York Times, the executives from Twitter gave Systrom an offer which he accepted verbally before backing out of it. He later went on with Facebook Inc (NASDAQ:FB)’s offer which had a valuation of $715 million.

The reason Systrom is under fire? His claims contradict the findings of the Twitter/Instagram offer. Under oath, he told California state regulators that he did not receive any real offers or term sheets before the Facebook Inc (NASDAQ:FB) offer.

The latest news will certainly only add to the tension between Instagram and Twitter. The former disabled Twitter synchronization last week, and the popular micro-blogging service answered by releasing their own photo filter feature on their application.

The battle between Facebook Inc (NASDAQ:FB) and Twitter has gotten pretty intense. For years, it seemed as if both social media giants were enjoying their fair share of internet domination, but now that popular photo sharing application Instagram is in the picture, the claws are coming out.

In time it should be interesting to see what happens with Twitter, Instagram, and Facebook Inc (NASDAQ:FB). If and when Facebook Inc (NASDAQ:FB) fully integrates Instagram with their website, how will this impact the company?