X can't duck Media Matters' abusive litigation suit

(CN) — Social media giant X failed to convince a federal judge to dismiss a lawsuit brought by Media Matters of America, which claims that it’s the subject of retaliatory and abusive litigations by X around the world for reporting that the platform placed ads by large corporations next to white supremacist posts.

U.S. District Judge Vince Chhabria in San Francisco denied on Thursday X’s motion to dismiss the complaint for lack of jurisdiction. The Elon Musk-owned social media platform, previously known as Twitter, had claimed that damages Media Matters can seek on its breach-of-contract claim are less than the $75,000 minimum amount needed to sue in federal court, or to transfer the case to a federal court in Texas.

“Because the limitation of liability clause in the terms of service may be unconscionable, it is not at all clear that Media Matters’s claim is below the threshold,” the judge, a Barack Obama appointee, said. “And attorneys’ fees incurred in defending a separate lawsuit can be recoverable as damages in a suit for breach of contract.”

However, the judge granted X a partial win on its separate motion to strike Media Matters’ claims under California’s anti-SLAPP statute, which can help a defendant to quickly overcome a lawsuit that is intended to interfere with their First Amendment free speech rights.

Media Matters’ breach-of-contract claim over the defamation lawsuit X filed against the media watchdog about 1 1/2 year ago in Fort Worth, Texas, didn’t survive.

The judge agreed with X that Media Matters had waived its right to challenge X’s decision to sue in Texas, rather than in San Francisco as the nonprofit argues X was required to do per its terms of service agreement with the platform’s users.

“It might be true as a technical matter that Media Matters’s ability to bring a claim for breach of the clause is separate from its ability to pursue a venue transfer under [the forum selection clause],” Chhabria wrote. “But the fact remains that Media Matters, despite being aware of the forum selection clause from the start, did not invoke it with respect to the Texas litigation for over a year and a half.”

On the other hand, the judge rejected X’s bid to strike Media Matters’ claims that pertained to the similar lawsuits X filed in Ireland and Singapore because, the judge said, those lawsuits are clearly not protected activity under the California anti-SLAPP statute.

In a third ruling Thursday, the judge denied X’s request to stay the lawsuit while it appeals a preliminary injunction he had issued in April that ordered X not to pursue it’s ongoing lawsuit against Media Matters in Ireland or to begin filing an additional lawsuit in the UK. The preliminary injunction didn’t stay the Singapore case since it was already well advanced.

“California policy favors the enforcement of forum selection clauses — and it seems almost certain that the X entities’ decision to file multiple suits in multiple jurisdictions is designed more to bully Media Matters and inflict financial hardship upon it than to actually vindicate those entities’ rights,” Chhabria said in his April ruling.

Attorneys for X and Media Matters didn’t immediately respond to requests for comment.

Media Matters sued X in San Francisco earlier this year to force the company to litigate its claims against the nonprofit in that jurisdiction, per the forum selection clause of its terms of service, and not in different courts around the world.

The first of these lawsuits, filed in Texas, came after Musk had threatened a “thermonuclear lawsuit” over watchdog’s reports that ads for well-known companies such as IBM and NBCUniversal appeared next white nationalist hashtags on X’s site.

Media Matters, according to X, knowingly and maliciously manufactured side-by-side images depicting advertisers’ posts on X beside Neo-Nazi and white-nationalist fringe content and then portrayed these manufactured images as if they were what typical X users experience on the platform.

X’s international corporate entities then followed up with similar lawsuits in Ireland and Singapore, and threatened to also bring a case in the UK.

“X Corp.’s multiplicity of suits against Media Matters is part of a broader strategy to intimidate the media and recoup lost advertising dollars by any means possible,” the nonprofit said in its March 10 complaint. “It has cost Media Matters millions to litigate and forced Media Matters to layoff over a dozen employees—a result that Musk has publicly celebrated.”

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