• by Wendy Davis  @wendyndavis, December 14, 2022

Siding against Twitter, a federal appeals court has confirmed an earlier decision that prevents the company from proceeding with an attempt to halt Texas Attorney General Ken Paxton's investigation into content moderation policies.

In a ruling issued Wednesday, a three-judge panel of the 9th Circuit Court of Appeals said Twitter couldn't proceed with its lawsuit against Paxton because the company failed to establish that the investigation affected editorial decisions.

“Twitter’s complaint, taken as true, does not show any chilling effect on its speech,” Circuit Judge Ryan Nelson wrote in a 20-page opinion joined by Circuit Judges Mark Bennett and Patrick Bumatay.

Wednesday's decision replaces one issued in March by the same three judges.

The battle between Twitter and Paxton began last year, when Twitter (and other major social platforms) banned former president Donald Trump from the platform. Current Twitter owner Elon Musk recently reversed the ban, but that move hasn't affected the court battle.

Paxton, a vocal critic of tech companies, almost immediately accused the tech companies of suppressing conservative voices. He launched an investigation of the companies and demanded that Google, Facebook, Twitter, Amazon Web Services and Apple disclose detailed information regarding their content-moderation policies.

Twitter sued Paxton in March of 2021, arguing that his investigation violates the First Amendment because the probe could have a “chilling effect” on the company's exercise of its free speech rights.

“The First Amendment bars the state from telling a newspaper which editorials it must run,” Twitter argued in court papers. “The First Amendment therefore likewise bars the state from telling Twitter whose speech it must carry and distribute on its platform.”

The company sought a court order barring Paxton from carrying out the probe, and a declaratory judgment that the investigation was unconstitutional.

Paxton contended that his investigation doesn't raise free speech concerns, because it centers on whether Twitter violated a state false advertising law by allegedly misleading consumers about its content standards.

Paxton specifically pointed to public statements by former Twitter executives, such as former CEO Jack Dorsey, who testified to the Senate Commerce Committee that the platform's editorial policies aren't based on ideology. The attorney general argued that he was entitled to investigate whether statements such as Dorsey's were true.

In March, a three-judge panel of the 9th Circuit sided with Paxton. 

“Even if content moderation is protected speech, making misrepresentations about content moderation policies is not,” Nelson wrote in that earlier opinion.

“If Twitter’s statements are misleading commercial speech, and thus unprotected, then Twitter’s content moderation decisions would be a proper cause for the investigation,” Nelson added.

Twitter then sought a new hearing at the 9th Circuit, arguing that the panel shouldn't have applied standards regarding advertising to statements about content moderation.

“There was no need (or basis) to hold -- in advance of any analysis of the facts -- that Twitter’s statements about political neutrality in content moderation should be judged on the same standards applicable to ordinary advertisements of a commercial enterprise selling widgets, rather than one distributing and moderating news and information,” the company wrote in its request for a new hearing.

The decision issued Wednesday doesn't address whether Twitter executives' statements about content moderation are “commercial” or “editorial” speech.

Instead, the judges ruled that Twitter's complaint, even if proven true, wouldn't show exactly how the company's First Amendment rights were affected by Paxton.

“Twitter’s naked assertion that its speech has been chilled is 'a bare legal conclusion,'” the judges wrote.

They added that Twitter's other claims about chilled speech were too vague to support its complaint against Paxton.

It's not yet clear whether Twitter will seek review by the Supreme Court.