• by Wendy Davis  @wendyndavis, September 23, 2024

The watchdog Media Matters of America is seeking to immediately appeal a Texas judge's decision allowing X Corp. to proceed with claims over a report alleging that ads for large companies were appearing next to pro-Nazi posts on the platform.

In papers filed Friday with U.S. District Court Judge Reed O'Connor in Fort Worth, Media Matters and two of its reporters argue that one of the key legal issues in the case -- whether the lawsuit belongs in Texas -- warrants immediate review by the 5th Circuit Court of Appeals.

“Lawsuits like this one pose a severe threat to press freedom,” Media Matters and the reporters argue in a petition seeking permission for an immediate appeal.

“The court should not run the risk of subjecting defendants to years of chill of their First Amendment rights, coupled with millions of dollars of litigation expense, without making sure of its jurisdiction,” the group adds.

The advocacy group's request comes in a battle dating to November, when Media Matters reported that ads for brands including Apple, Bravo, IBM and Oracle were being placed next to pro-Nazi posts.

After the report came out, Apple, IBM, Comcast and other companies -- but not Oracle, according to court papers -- suspended advertising on X, formerly Twitter.

Elon Musk's X Corp. subsequently alleged in a complaint filed in federal court in Texas that Media Matters “manipulated” X's algorithms in order to “bypass safeguards and create images of X’s largest advertisers’ paid posts adjacent to racist, incendiary content.”

The tech platform also said ad placements highlighted in Media Matters' report were “inorganic” and rare.

The company's complaint included claims that Media Matters and its reporters interfered with X's contracts and disparaged its business.

In February, Media Matters urged Fort Worth to throw out the case.The advocacy group -- which is based in Washington, D.C. -- made several arguments, including that X lacked a valid basis to sue in Texas.

O'Connor rejected Media Matters' request last month. He said in a 16-page opinion that X could proceed in Texas because two of X's advertisers -- AT&T and Oracle -- are based in that state.

“The alleged conduct was directed at two blue-chip advertising Texas companies,” O'Connor wrote. “A defendant who targets a Texas company with tortious activity has fair warning that it may be sued there.”

Media Matters and the reporters now argue that O'Connor's ruling “stretches the boundaries of personal jurisdiction well beyond those firmly established by Fifth Circuit and Supreme Court precedent.”

They add that the November report didn't name AT&T, and that Oracle didn't suspend ads on X.

The ruling “will have harmful, chilling consequences for journalists in the internet age, exposing them unpredictably to jurisdiction in any state that is home to any third-party individual or entity that is simply mentioned in any article,” the group writes.

X Corp., which has lost significant ad revenue since its 2022 acquisition by Musk, is separately suing the World Federation of Advertisers' Global Alliance for Responsible Media for allegedly triggering a “massive advertiser boycott.”

The Global Alliance for Responsible Media discontinued operations soon after the suit was filed.

The tech company additionally sued the research group Center for Countering Digital Hate after that organization issued critical reports about content on the platform. In March, U.S. District Court Judge Charles Breyer in the Northern District of California threw out that case under California's anti-SLAPP (strategic litigation against public participation) law, which enables defendants to obtain rapid dismissals of claims based on statements about matters of public interest.

X Corp. recently asked the 9th Circuit Court of Appeals to reinstate the claims.