The Federal Trade Commission should
not be allowed to resume its attempt to investigate Media Matters for America, the watchdog argues in papers filed Tuesday with the D.C. Circuit Court of Appeals.
"The First
Amendment prohibits public officials from weaponizing 'the power of the State to punish or suppress disfavored expression,'" Media Matters argues, quoting from a recent Supreme Court ruling regarding
free speech.
"But in this case, that is precisely what happened," the group writes, adding that the FTC "wielded its investigatory authority to retaliate against a media
organization."
The organization's argument comes in a battle dating to June 2025, when Media Matters sued to block the FTC from pursuing a broad "civil investigative demand"
(comparable to a subpoena) for a trove of information -- including material regarding its finances and newsgathering, and documents relating to the Interactive Advertising Bureau, World Federation of
Advertisers and its now defunct Global Alliance for Responsible Media, Check My Ads, the Center for Countering Digital Hate, Double Verify and NewsGuard, among other groups.
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Media Matters alleged that the FTC undertook the probe to retaliate for a November 2023 report that ads for Apple, Bravo, IBM, Oracle and other brands were being placed next to
pro-Nazi posts on Elon Musk's X. (Musk also sued Media Matters over the report; that matter is ongoing.)
U.S. District Court Judge Sparkle Sooknanan in Washington, D.C. sided
with Media Matters, ruling in August that the group was likely to prove that the FTC's demand for information was issued with "retaliatory animus," and therefore unconstitutional.
"Speech on matters of public concern is the heartland of the First Amendment," Sooknanan wrote in an opinion granting Media Matters' request for an injunction. "It should alarm all
Americans when the government retaliates against individuals or organizations for engaging in constitutionally protected public debate."
The FTC recently sought to lift the
injunction, arguing that its investigation concerns "potential anticompetitive collusion in the digital advertising industry to withhold advertising from certain disfavored media."
"Such concerted action would likely violate the federal antitrust laws and harm the public by reducing competition in markets for advertising purchasing and other advertising-related
products or services, which could in turn reduce consumer choice in content, degrade the quality of advertisements, and ultimately stifle debate on matters of public importance," the agency claimed in
papers filed last month with the D.C. Circuit Court of Appeals.
Media Matters counters in its new papers that the FTC's argument regarding ad boycotts "should itself raise
alarm," adding that the Supreme Court ruled in 1982 that the First Amendment protects politically motivated boycotts.
"The FTC has offered no coherent explanation -- none
whatsoever -- for why its investigation into 'advertiser boycotts' is not just a naked effort to penalize protected First Amendment activity," Media Matters argues.
The FTC
also argued to the appellate court that Media Matters failed to prove the probe was retaliatory. The agency says the organization failed to show how its 2023 report about neo-Nazi content on X caused
the FTC to issue the subpoena.
The agency added that the investigation's broad scope -- involving subpoenas to 17 organizations, including trade associations and policy groups
-- shows that the subpoena to Media Matters wasn't issued to retaliate for a specific article.
In addition, the FTC says Media Matters' lawsuit is premature because the agency
hasn't attempted to enforce its demand for information.
But Media Matters counters that the investigation is currently harming the organization.
"After
the FTC issued its [civil investigative demand], Media Matters curtailed its reporting out of fear, and outside organizations have ceased collaborating with it," the group writes.
The D.C. Circuit is expected to hear oral arguments on April 13.