Nearly simultaneously, Texas Attorney General Ken Paxton opened an investigation into Media Matters for “potential fraudulent activity.” Musk posted the news on his X account, stating that “fraud has both civil and criminal penalties.” Musk had previously responded to a tweet by former Trump advisor Stephen Miller that suggested conservative attorneys general (like Paxton) look into fraud charges.
Neither Paxton nor X argues that Media Matters was falsely claiming to see ads on pro-Nazi content. In fact, the suit confirms that the screenshots the organization posted are real. But it alleges the organization “manipulated” the service to make X serve the offending ads. “Media Matters has manipulated the algorithms governing the user experience on X to bypass safeguards and create images of X’s largest advertisers’ paid posts adjacent to racist, incendiary content, leaving the false impression that these pairings are anything but what they actually are: manufactured, inorganic, and extraordinarily rare.” The alleged manipulation involved creating an account that exclusively followed a combination of major brands and extremist content, then “endlessly scrolling and refreshing its unrepresentative, hand-selected feed” until it saw a confluence of the two.
“We are going to continue our work undeterred.”
The lawsuit accuses Media Matters of interference with contract, business disparagement, and interference with prospective economic advantage — claims that could be difficult to prove given the First Amendment’s high bar for legally prosecuting speech. (Musk famously beat a libel suit after falsely dubbing one of his critics a “pedo guy.”) “We are going to continue our work undeterred. If he sues us, we will win,” the organization’s president Angelo Carusone told The Verge in a previous statement, saying that “Elon Musk has spent the last few days making meritless legal threats, elevating bizarre conspiracy theories, and lobbing vicious personal attacks against his ‘enemies’ online.” Carusone reiterated the sentiment after the suit was filed. “This is a frivolous lawsuit meant to bully X’s critics into silence,” he said. “Media Matters stands behind its reporting and looks forward to winning in court.”
As one of the world’s richest men, however, Musk has tremendous resources at his disposal — and X seems to be doing some forum shopping to boost its odds. The company filed its lawsuit in Texas, which is neither its nor Media Matters’ primary place of business. As legal blogger Ken White noted, a Texas filing protects X from claims that it filed a strategic lawsuit against public participation (or SLAPP), something it might face in its home base of California. Another organization that X sued, the Center for Countering Digital Hate, recently hit back with an anti-SLAPP motion in that state. Moving the lawsuit also puts it under the Fifth Circuit Court of Appeals, which has proven highly sympathetic to conservative figures who claim they’ve been censored — something Musk has made a centerpiece of his publicity strategy around X.
Yaccarino, meanwhile, has insisted that advertisers aren’t permanently pulling back their X presence. “Some advertisers may have temporarily paused but I do want to go on record, I had several really good conversations today,” she told employees at an all-hands after the lawsuit, according to Fortune. But she suggested employees “be as fiscally responsible as possible” to offset potential losses from advertisers and exhorted them to “by all means, put your heads together to bring new revenue into the company.”
Update 9:15PM ET: Added statement from Media Matters.