• by Wendy Davis  @wendyndavis, December 29, 2023

A federal judge has rejected X Corp's request to block enforcement of a new California law that requires social media platforms to post content moderation policies and provide reports to the state attorney general about enforcement.

In an order issued Thursday, U.S. District Court Judge William Shubb in Sacramento ruled that even though the law (AB 587) appears to place a “substantial burden” on social media companies, the measure likely isn't “unjustified or unduly burdensome within the context of First Amendment law.”

He wrote that the disclosure mandates are “reasonably related to a substantial government interest in requiring social media companies to be transparent about their content moderation policies and practices so that consumers can make informed decisions about where they consume and disseminate news and information.”

The law is set to take effect next week, unless an appeals court intervenes.

X Corp., which saw ad revenue drop after loosening content-moderation policies last year, sued in September to block the law, arguing it violates the First Amendment by compelling speech.

The statute “compels social media companies to engage in speech against their will about one of the most controversial political topics: how to define speech that should be restricted or disfavored on social media platforms and how to apply those definitions and decide what speech to permit or limit on such platforms,” X Corp. argued in its request for an injunction.

Shubb said in his ruling that a website's terms of service appear to be “commercial speech,” which generally doesn't have the same level of First Amendment protection as non-commercial speech such as news stories or editorials.

“The 'terms of service' as defined in AB 587 appear to bear all of the hallmarks of commercial speech,” he wrote.

“Although the terms of service may not literally be advertisements in the sense of proposing a commercial transaction, they are directed to potential consumers and may presumably play a role in the decision of whether to use the platform,” he added.

Santa Clara University law professor Eric Goldman, who disagreed with the outcome, suggested Shubb didn't adequately consider the difference between disclosures about editorial practices and disclosures regarding purely factual information, such as calorie counts on nutrition labels.

The ruling shows a “tone deafness to the editorial implications,” he tells MediaPost.