Texas judge who owns Tesla stock rules Elon Musk can take media watchdog to trial over Nazi claims
Elon Musk’s lawsuit seeking damages from a left-leaning media watchdog group may proceed to trial, a U.S. federal district judge said on Thursday. The judge is an investor in Musk’s electric car company, Tesla, but has not recused himself from the case.
Musk sued Media Matters for America in November after the latter published a report that claimed Twitter (now X) showed ads for major brands, including Disney, next to anti-Semitic and neo-Nazi content.
Many companies then pulled their ad spending, prompting a now-infamous outburst from Musk in which the entrepreneur told advertisers to collectively “go fuck yourself.”
He also took to social media to threaten “thermonuclear” consequences for anyone who “colluded in this fraudulent attack on our company.”
The ruling dismisses a motion filed by the defendant arguing Musk as the plaintiff failed to present proper cause and engaged in blatant venue shopping by enlisting a jurisdiction in which neither X nor Media Matters is based.
In the ruling, Judge Reed O’Connor agreed with Musk’s argument that Texas was sufficiently entitled to decide the dispute, since Media Matters had targeted among other companies those headquartered in the Northern District of Texas, including AT&T. That was enough to meet the threshold for pursuing damages under tort law, the judge determined, since existing jurisprudence made no distinction as to whether other venues might in fact be more proper.
“A defendant who targets a Texas company with tortious activity has fair warning that it may be sued there,” concluded O’Connor, throwing out the dismissal.
Media Matters could not be immediately reached by Fortune for comment.
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 pic.twitter.com/55vl7PspaQ
— Elon Musk (@elonmusk) November 18, 2023
GARM lawsuit confirms suspicion Musk shopped for sympathetic judge
Yet the circumstances of the lawsuit are not as clear-cut as they would seem. Musk has repeatedly filed claims in the Northern District of Texas in what legal experts have said is a clear attempt to land O’Connor as the presiding judge.
In their view, Musk is shopping for a judge most sympathetic to his cause in a state that will allow him to silence would-be critics, not just in Texas but nationwide.
Musk also chose O’Connor’s Northern District when suing the Global Alliance for Responsible Media (GARM) earlier this month, claiming members of the advertising standards body unlawfully conspired against buying ads on his platform. At the time many experts argued the case was dubious at best, and potentially designed to entangle defendants in legal fees so costly they served as a deterrent.
Surprisingly, however, O’Connor recused himself in the case of GARM without explanation shortly after NPR revealed he might be conflicted since he owned Tesla stock.
Criminal charges dropped, but legal costs force Media Matters to sack staff
It’s not just the judicial system that Musk can rely on in Texas for support, a state executive has taken his side as well.
Immediately after the Tesla CEO filed his lawsuit, state Attorney General Ken Paxton opened an investigation into Media Matters, with Musk warning it would now also face criminal consequences. (A federal judge later stopped it.)
“Elon Musk encouraged Republican state attorneys general to use their power to harass their critics and stifle reporting about X,” Media Matters president Angelo Carusone said in a statement in April.
Musk’s lawsuits have proved effective when it comes to draining defendants of their financial resources. Earlier this month GARM shut its doors, while Media Matters laid off a dozen staffers in May, including Katherine Abughazaleh, a vocal critic of Musk with a large social media following.
“We’re confronting a legal assault on multiple fronts, and given how rapidly the media landscape is shifting, we need to be extremely intentional about how we allocate resources in order to stay effective,” Carusone told Newsweek at the time.
Fortune has contacted Musk and O’Connor for comment.
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