New York Seeks to Dismiss Elon Musk’s X Lawsuit Over Social Media Transparency Law

New York Attorney General Letitia James has asked a federal judge to dismiss a lawsuit filed by Elon Musk’s X, formerly known as Twitter, challenging the state’s new law that mandates transparency on how social media companies handle hate speech, extremism, and disinformation.

James defended the Stop Hiding Hate Act, asserting that it empowers users by requiring major platforms to disclose their content moderation policies and enforcement activities. She emphasized that the law does not restrict speech but ensures consumers can make informed decisions about their online interactions.

The law, signed in December 2024 by Governor Kathy Hochul, applies to social media companies generating at least $100 million in annual revenue. These platforms must publicly report how they address harmful content and demonstrate their progress. Violations can result in fines of up to $15,000 per day. The legislation was crafted with input from the Anti-Defamation League, aiming to enhance online safety and accountability.

In response, Musk’s company argued that the law infringes on free speech rights and exposes platforms to costly lawsuits and penalties for hosting “controversial” content. X’s legal team, which includes noted First Amendment attorney Floyd Abrams, referenced a similar California law that was blocked on constitutional grounds. California later agreed not to enforce its disclosure rules following a federal appeals court ruling.

James countered that the California court’s reasoning was flawed, noting that the Second Circuit—covering New York—has recognized such disclosures as a form of commercial speech subject to regulation.

Musk, who acquired Twitter for $44 billion in 2022 and dismantled many of its content moderation policies, has long positioned himself as a “free speech absolutist.” The case, X Corp v. James, is being heard in the U.S. District Court for the Southern District of New York under case number 25-05068.