X Sues Media Matters As More Brands Pull Out of Advertising

In a legal battle that unfolded on Monday, Elon Musk's X (formerly Twitter) filed a lawsuit against Media Matters for America, alleging that the liberal advocacy group deliberately concocted a report to associate advertisers' posts with neo-Nazi and white nationalist content, aiming to undermine the platform and drive advertisers away.

Media Matters, a non-profit based in Washington DC, dismissed the lawsuit as "frivolous."

Amid concerns about advertisements appearing alongside pro-Nazi and hate speech content on the platform, X faced a blow as major brands like IBM, Apple, NBCUniversal and Comcast halted their ad campaigns following the Media Matters report.

The report implicated major brands that ran ads that were displayed alongside antisemitic material on X, with ads from Amazon, NBA Mexico, NBCUniversal and others reportedly found adjacent to white nationalist hashtags.

Commenting on the scandal, X asserted that Media Matters intentionally depicted ads alongside offensive material, presenting them as representative of typical user experiences on the platform.

Media Matters is pure evil https://t.co/gIV1rHO9d7

— Elon Musk (@elonmusk) November 20, 2023

X's complaint argued that Media Matters manipulated platform algorithms to create false impressions, using X accounts following users known for extreme content and accounts belonging to major X advertisers.

This allegedly resulted in manufactured and rare juxtapositions that Media Matters then captured in screenshots to drive away X's advertisers.

Media Matters responded, standing by its reporting and expressing confidence in prevailing in court. Angelo Carusone, the president of the non-profit, denounced the lawsuit as an attempt to silence X's critics.

Simultaneously, Texas Attorney General Ken Paxton announced an investigation into Media Matters for potential fraudulent activity related to the group's report.

More Brands Pull Out of Advertising on X

Amid its ongoing legal challenges, more brands have decided to stop their ads on X.

Paris Hilton's 11:11 Media has pulled its advertising campaign from the platform just a month after announcing an exclusive partnership.

The move, influenced by concerns over antisemitism and pro-Nazi content on the platform, marks the company as one of the several retail and tech giants that have done the same. Its withdrawal follows a major collaboration aimed at launching new initiatives and establishing a revenue-sharing agreement.

Hilton's company's decision adds to a growing list of advertisers, including Ubisoft, who have paused campaigns for Assassin's Creed Nexus VR, as reported by several media reports.

Despite the setback, Hilton remains active on X via her account, @ParisHilton, boasting 16.6 million followers.

X To Donate Ad Revenue to the Middle East

In response to mounting criticism following his support for an antisemitic post on X, Elon Musk has announced that his platform will donate any revenue generated from advertising and subscriptions linked to the war in Gaza.

The funds will be directed towards hospitals in Israel and the Red Cross in Gaza.

X Corp will be donating all revenue from advertising & subscriptions associated with the war in Gaza to hospitals in Israel and the Red Cross/Crescent in Gaza

— Elon Musk (@elonmusk) November 21, 2023

Musk, who frequently utilizes X to express his views and share company updates, assured transparency in the donation process.

In response to another user, Musk argued that X "will track how funds are spent and go through Red Cross/Crescent."

The commitment to donate ad and subscription revenue, although lacking specific fundraising goals initially, could be there to address the controversy sparked by Musk's endorsement of an antisemitic post.