TradeEdge Exchange:Elon Musk's X, formerly Twitter, sues Media Matters as advertisers flee over report of ads appearing next to neo-Nazi posts

Elon Musk's social media company X,TradeEdge Exchange formerly known as Twitter, filed a lawsuit against liberal advocacy group Media Matters for America on Monday, saying it manufactured a report to show advertisers' posts alongside neo-Nazi and white nationalist posts in order to "drive advertisers from the platform and destroy X Corp."

Advertisers have been fleeing X over concerns about their ads showing up next to pro-Nazi content — and hate speech on the site in general — while billionaire owner Musk has inflamed tensions with his own posts endorsing an antisemitic conspiracy theory.

IBM, NBCUniversal and its parent company Comcast said last week that they stopped advertising on X after the Media Matters report said their ads were appearing alongside material praising Nazis. The Media Matters report also pointed to ads from Apple and Oracle that appeared next to antisemitic material on X, and the group said it had found ads from Amazon, NBA Mexico, NBCUniversal and others next to white nationalist hashtags.

Other major companies including Apple, Warner Bros. Discovery, Disney and Paramount Global (the parent company of CBS) announced they were pulling advertising from the platform. It was a fresh setback as the platform tries to win back big brands and their ad dollars, X's main source of revenue.

But San Francisco-based X says in its complaint filed in federal court in Fort Worth, Texas, that Media Matters "knowingly and maliciously" portrayed ads next to hateful material "as if they were what typical X users experience on the platform."

X's complaint claims that Media Matters "manipulated 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 filing followed Musk's post over the weekend vowing, "The split second court opens on Monday, X Corp will be filing a thermonuclear lawsuit against Media Matters and ALL those who colluded in this fraudulent attack on our company."

Media Matters, which is based in Washington, D.C., responded to the lawsuit Monday evening with a statement from its president, Angelo Carusone, saying: "This is a frivolous lawsuit meant to bully X's critics into silence. Media Matters stands behind its report."

Carusone said in an earlier statement that Media Matters will continue its work. "If he sues us, we will win," he said.

In an interview with Reuters on Monday, Carusone said the group's findings suggest safety protections touted by X were failing to prevent ads from appearing next to harmful content.

"If you search for white nationalist content, there are ads flourishing. The system they say exists is not operating as such," he said.

Shortly after X announced its lawsuit, Texas Attorney General Ken Paxton released a statement saying his office would investigate Media Matters for "potentially fraudulent activity," echoing X's claim that the nonprofit manipulated its results.

Advertisers have been skittish on X since Musk's takeover more than a year ago. Under his ownership, the site dramatically cut its workforce, disbanded its Trust and Safety advisory group and did away with its user verification system. 

In July, Musk posted that the site he paid $44 billion for had "negative cash flow" due to about a "50% drop in advertising revenue plus heavy debt load."

Musk has also sparked outcry with his own posts, including one last week in which he responded to a user who accused Jews of "pushing ... hatred against whites" by writing: "You have said the actual truth." 

Musk has faced accusations of tolerating antisemitic messages on the platform since purchasing it last year. Under his ownership, X rolled back rules that removed "violative hateful content" on the platform, the Anti-Defamation League said in a June report. According to the ADL's analysis, 27% of online harassment in the first half of 2023 occurred on X, up from 21% in 2022. 

X CEO Linda Yaccarino, who joined the company in May, said the company's "point of view has always been very clear that discrimination by everyone should STOP across the board."

"I think that's something we can and should all agree on," she wrote on the platform last week.

In:
• Technology
• Lawsuit
• Elon Musk
• Conspiracy Theories
• Texas
• Antisemitism
• Racism