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(CN) — An attorney representing progressive news watchdog Media Matters told a federal judicial panel in New Orleans Tuesday that a lower court order requiring the organization to disclose donor information violated its First Amendment rights.
The organization’s donor information is sought by Elon Musk and attorneys representing X.com, who filed suit against Media Matters in 2023 for a report suggesting ad revenue supported white nationalist and antisemitic content on X. Musk claimed the report amounted to intentional interference with contracts and disparagement.
In September 2024, U.S. District Judge Reed O’Connor, a George W. Bush appointee, found Media Matters waived its First Amendment privilege by failing to comply with various requests for documents and required the organization to hand over donor information.
On Tuesday, attorney Gregg Costa argued the First Amendment right was never waived and that O’Connor issued the order without considering some of the organization’s primary objections.
“The district court’s discovery order strikes at the heart of the First Amendment right of association,” he said. “It compels Media Matters to turn over the name of every single donor, the address of those donors, and how much money each donor gave. X’s demand for this highly sensitive personal information that has no plausible relevance to the issues in this case comes nowhere close to surviving the exacting scrutiny that the Supreme Court recently emphasized applies to efforts to overcome the First Amendment right to anonymity.”
Costa said X could not cite a single order from any court requiring similar disclosures and warned that affirming the order would have a profound chilling effect on donor-funded organizations, opening the door for harassment or retaliation against supporters. He further argued the Fifth Circuit Court of Appeals has jurisdiction under the collateral order doctrine and the lower court order is considered a “state action” that must be overturned due to free exercise concerns.
U.S. Circuit Judge James E. Graves, a Barack Obama appointee, asked Costa to clarify whether the waiver was granted as a sanction for Media Matters’ failure to comply with discovery deadlines and orders.
Costa said the standard is a party must intentionally relinquish its First Amendment right through affirmative conduct. He said O’Connor did not allow the parties to resolve discovery disputes before compelling the disclosure of donor information.
He also claimed the organization complied with court deadlines and discovery orders, and the parties agreed to allow more time to produce privilege logs.
In response to a question from U.S. Circuit Judge Don R. Willett, a Donald Trump appointee, Costa acknowledged the organization did not even search for contested information but argued that by following standard discovery practices, they were not required to.
“You search for documents that are responsive, limited by your objections,” he explained. “Then let’s say you get 1,000 documents. You would then go through those 1,000 documents for privilege review. That’s exactly what we did here.”
Costa said Media Matters searched for internal communications that included the phrases “Musk,” “X,” and “content moderation” and provided them to the plaintiffs. He emphasized that the lower court failed to address the organization’s harassment concerns.
“I think it is especially strong here, given the threats by [Musk] directly, not just to our organization — calling it evil — but to our donors, saying that he is coming after them,” Costa said, citing statements Musk made about the case at the New York Times’ 2023 DealBook Summit. He also said the information is irrelevant to the case.
“How is the name of a person who gave a $50 donation to Media Matters three years ago relevant to this lawsuit over two discrete articles that were published in November of 2023?” Costa asked.
Representing X, attorney Judd E. Stone II said Media Matters spent four months defying the lower court’s routine court order and O’Connor “permissibly concluded” the organization waived its First Amendment privilege.
“There are many reasons for this court to hold media matters to the consequences of its actions,” Stone said, arguing the organization acted in bad faith. Stone said the donor information is relevant to interpreting the organization’s news coverage and noted that other nonprofit outlets such as ProPublica and The Texas Tribune voluntarily disclose donor information. He also noted the lower court order specifically states the list must be provided in camera, meaning it can only be reviewed by attorneys in court and will not be provided to their client without additional authority.
In response to a question from the third panelist, George W. Bush appointee U.S. Circuit Judge Edith Brown Clement, Stone said the donor list would support X’s primary claims.
“What we allege in our complaint isn’t nearly that there was a mistake or that false statements were made, but they were done with a wrongful mindset; they’re deliberate lies,” he said. “If there was a great deal of donors or great deal of dollars from donors who happen to have an axe to grind with X or Elon Musk or Twitter or anything else relevant in the case, that would go a long way to being able to show to a jury a reason why Media Matters lied. It would be powerful evidence we would need to show malice.”
Judge Graves got Stone to admit that at least a portion of the lower court’s order was incorrect by stating Media Matters did not produce a privilege log at all when it, in fact, produced a “first” privilege log. But Stone said the mistake should not change the panel’s analysis.
“The order was very specific: to identify, log, and deliver,” he said. “None of those three things occurred.”
Judge Willett asked Stone to elaborate on the harassment concerns. Stone said the attorneys would have to seek express consent to disclose the donor list to Musk or others and would be subject to contempt of court sanctions if they violated that agreement.
Stone stressed that it is a “nine-figure case” for X and that he intends to play by the rules:
“To the extent that this case matters, and it certainly matters to X Corp., we’d be subject to death penalty sanctions for severe misbehavior, not to mention potentially criminal or civil contempt sanctions if someone at X Corp. over the district court’s direct instruction were to receive or misuse this information notwithstanding a court order.”
Judge Graves said he considered the waiving of a constitutional right to be a “draconian sanction” and wondered whether less severe sanctions were considered. He also noted the donors were not parties to the litigation. Stone said there is no evidence other sanctions considered in the record, but O’Connor’s remedy was appropriate.
The panel took the case under submission and did not indicate when a ruling may be published.
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