Media Matters’ Very Strong Response To Elon Musk’s Very Dumb Lawsuit

Last fall, we detailed the many, many, many, many problems of Elon Musk’s absolutely bullshit ridiculous lawsuit against Media Matters. Again, if you don’t recall, Media Matters found some examples of neo-Nazi content on ExTwitter appearing next to ads from big name brands. Elon got extra mad about this because it also happened a day after he endorsed an anti-Semitic conspiracy theory trope. Either way, it led to many advertisers pulling their ads.

Rather than being a “free speech absolutist” like he pretends he is, Musk decided to sue Media Matters for its free speech. In that lawsuit, ExTwitter admits that what Media Matters saw actually happened (which basically torpedoes the lawsuit). Their complaint was (1) that Media Matters had to take some steps to see those ads, (2) most users would not take those steps, and (3) that people read Media Matters’ article to imply that most users would also experience the same thing (even though Media Matters never actually said that).

That defense would have actually been a useful thing for ExTwitter to just publicly say. A perfectly reasonable and smart response to the Media Matters report would have been, “Hey, so, Media Matters followed a bunch of Nazis and kept reloading until they saw some ads, and that’s something we’re constantly working on and trying to improve for our advertising partners, but it’s an impossible task to make sure that never happens. It’s extremely rare and is unlikely to happen for most people, and we’re continuing to work on improving.”

Or something like that. Instead, Elon decided to sue. In Texas (despite none of the parties being there), while admitting that everything Media Matters wrote was accurate, but they just didn’t like the way that Media Matters went about getting that info and how people interpreted it. But the way that Media Matters got the info (following Nazis and then reloading) is very much allowed by the system. If ExTwitter doesn’t like that, it (1) shouldn’t platform Nazis or (2) shouldn’t allow you to follow Nazis or (3) shouldn’t allow you to reload. But it does all three, so it really can’t complain.

Anyway, Media Matters has now filed its motion to dismiss. I had been a little nervous when Media Matters hired the Elias law firm to handle this, as they’re mostly focused on election law, not these kinds of free speech cases. But they also brought on some excellent free speech lawyers, including Ted Boutrous from Gibson Dunn. It’s a very strong filing.

The biggest and most obvious thing: what the fuck is this doing in Texas:

This Court lacks personal jurisdiction over Defendants Media Matters for America (“Media Matters”), a Washington, DC-based media organization, and its Maryland-based investigative reporter Eric Hananoki. Plaintiff X Corp. (“X”) sues for statements made by Mr. Hananoki in an article published on the Media Matters website. But it is blackletter law that a statement made on a passive website—one that just posts information that people can see—cannot support specific jurisdiction in Texas simply because readers in Texas could access the statement as easily as readers in other states. And this is all X alleges—that it has lost favor with some unspecified number of advertisers and individuals, some unspecified number of which are located in Texas, because of statements Defendants made on the internet.

X does not and cannot allege a single fact supporting jurisdiction over either Defendant. X does not allege that Media Matters or Hananoki are “at home” in Texas. It does not allege that Media Matters or Hananoki performed any act in Texas. It does not allege that Media Matters or Hananoki specifically directed any statement toward a Texas audience, used Texas sources in drafting any statement, or even mentioned Texas in any statement. X has thus failed to carry its burden to show personal jurisdiction over Defendants.

For these same reasons, venue is also improper in this Court. Plaintiffs may sue defendants only in courts where the basic constitutional requirements for personal jurisdiction and the limitations imposed by the federal venue statutes are met. These include, at a bare minimum, adequate contacts with the forum for the defendant to reasonably anticipate being haled into court there. This case does not come close to clearing that threshold. Neither party is based in Texas and the allegations at issue in this case have zero connection to Texas. X has thus failed to provide any convincing justification for litigating this dispute in Texas. On this basis alone, this Court should dismiss the complaint under Federal Rule of Civil Procedure 12(b)(3).

In all reality, the court should dismiss it on this point alone. It’s obvious that the case has no business being in Texas and that the court has no jurisdiction over the defendants’ actions.

But, if the court decides to ignore all that, the underlying case is also bullshit. The claims of contract interference? That’s not how this works:

X’s complaint wholly fails to plead—never mind plausibly allege—basic elements of its claim for interference with contract. See Compl. ¶¶ 42–44 (First Cause of Action). Under Texas law, “[t]he elements of tortious interference with existing contractual relations are ‘(1) an existing contract subject to interference, (2) a willful and intentional act of interference with the contract, (3) that proximately caused the plaintiff’s injury, and (4) caused actual damages or loss.’” Nix v. Major League Baseball, 62 F.4th 920, 934 (5th Cir. 2023) (quoting Prudential Ins. Co. of Am. v. Fin. Rev. Servs., Inc., 29 S.W.3d 74, 77 (Tex. 2000)), cert. denied, 144 S. Ct. 165 (2023). X fails to adequately plead at least the first three elements.

Off the bat, X fails to allege “an existing contract subject to interference”—the very first element. Nix, 62 F.4th at 934. Indeed, the complaint does not even use the word “contract” until it makes its legal allegations in the First Cause of Action, see Compl. ¶¶ 42–44, and nowhere alleges that any advertisers had any obligation to place advertisements on X for a specified term or up to a minimum spend. Because X has simply “not identified a written or an enforceable oral contract with” any advertiser, there is no basis to infer that X’s advertisers “had a contractual obligation to continue using [X’s] services.” Rimkus Consulting Grp., Inc. v. Cammarata, 688 F. Supp. 2d 598, 675 (S.D. Tex. 2010). X cannot sustain its first claim without alleging the existence of such a contract. Id. at 674 (“A cause of action for tortious interference with a contract will not lie in the absence of a contract.” (collecting cases))

Merely claiming that certain advertisers purchased advertising space on X in the past—and anticipating they would continue to do so in the future—is not enough to plead an interference with contract claim under Texas law. See Amey v. Barrera, No. 13-01-00130-CV, 2004 WL 63588, at *10 (Tex. App.—Corpus Christi Jan. 15, 2004, no pet.) (concluding “there were no contracts subject to interference” where third parties could “continue buying” products from a vendor so long as they wished but “could change vendors at any time”). X has made no allegation that it had “a legal right to future performance” from its advertisers under a contractual obligation, and instead “just [had] a hope” that advertisers “will continue” to purchase from it in the future. Restatement (Third) of Torts: Liab. for Econ. Harm § 17 (2020). X cannot state an interference with contract claim for “benefits that [X] hoped to receive but on which [X] had no right to insist.”

How about the “business disparagement” claim that some people pretended was a defamation claim. In the complaint, we noted that before the claims, the complaint made it out like this was a “defamation” case, but never actually made a defamation claim. Some people argued that because there’s a “business disparagement” claim that’s the same thing. The two are similar, but they are not the same. And, either way, nothing in the complaint supports a business disparagement claim (which has a very high bar):

X’s business disparagement claim cannot survive because X cannot plausibly allege that Defendants’ statements are false. Broughton, 2010 WL 3056862, at *11. X never claims in the complaint that Defendants fabricated the images reproduced in their articles. Far from it: X expressly acknowledges (as it must) that it is possible for the platform to display advertisements next to extremist content, even as it claims these pairings are “rare.” See Compl. ¶¶ 7, 13, 35; see also ¶ 6 (indicating that one percent “of X’s measured ad placement in 2023 [] appeared adjacent to content [not] scoring above the Global Alliance for Responsible Media’s brand safety floor”).

X’s only quarrel appears to focus on how often these pairings occurred and whether they are “organic,” but nothing in the complaint—let alone the disputed articles—suggests that Media Matters or Mr. Hananoki opined on the overall quantity of pairings. Furthermore, if X’s supposed safeguards worked, id. ¶ 25, it would have been impossible for Defendants to “exploit[] . . . X’s user features” to bring about the pairings, id., since Defendants have no authority or control over X, its algorithm, or its advertisement placement. X’s allegation, therefore, that Defendants “created” the pairings, id. ¶ 26, is simply not plausible.

Also, the whole actual malice thing:

Actual malice requires proof that the defendant made a statement “with knowledge that it was false or with reckless disregard of whether it was true or not.” New York Times, 376 U.S. 254 at 279–80). Even where statements are “not strictly true,” if they are “substantially so and not made with reckless disregard of the truth,” there is no actual malice. BDO Seidman LLP v. Alliantgroup, L.P., No. H-08-905, 2009 WL 1322555, at *12 (S.D. Tex. May 11, 2009).

Given that X does not plausibly allege that Defendants’ statements were false, it necessarily follows that X cannot plausibly allege that Defendants “knew [their] statements were false.” Rimkus Consulting Grp., 688 F. Supp. 2d 598 at 671. But even beyond that truism, X fails to allege any facts that could plausibly support a finding that Defendants acted with actual malice; instead, X relies on nothing more than conclusory statements, contending, for example, that Defendants’ statements were “not true and, Media Matters knew it.” Compl. ¶ 25. But this recitation does “not allow the court to infer more than the mere possibility of wrongdoing” and is not enough to state a proper claim. Moser v. Omnitrition Int’l Inc., 2018 WL 1368789, at *2 (N.D. Tex. Mar. 16, 2018) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).

There’s more, but you get the point. The case was garbage from the start, and the motion to dismiss explains why. I’m guessing the most likely move is to dismiss over the jurisdiction issue, followed by Musk appealing to the 5th Circuit, where Calvinball takes over and the court will probably make a mockery of every precedent applicable here, because that’s just how the 5th Circuit works.