FTC probes Media Matters’ exchanges with ad groups, stoking fears of retribution

By Liam Reilly, CNN

(CNN) — The Federal Trade Commission on Wednesday sent Media Matters for America a letter demanding communications between the progressive media watchdog and advertising entities as the commission probes whether the watchdog colluded with advertisers to pull funding from Elon Musk’s X.

Media Matters was notified in a letter dated May 20 from the FTC that it is being investigated, a source familiar with the letter told CNN. The letter, which CNN has viewed, directs Media Matters to turn over all documents, materials and communications with a range of ad entities and related organizations — including the World Federation of Advertisers and the Global Alliance for Responsible Media — regarding brand safety and disinformation, the source said.

Media Matters is a media watchdog whose reporting tracks conservative and far-right news publications and personalities. The organization was sued by Musk in 2023 after it published a report detailing antisemitic and pro-Nazi content on the social media platform he owns, X. That lawsuit accuses the media watchdog of hatching a “media strategy to drive advertisers from the platform and destroy X Corp.”

In keeping its request for assorted materials vague, the FTC is effectively throwing the kitchen sink at the wall to see what sticks, the source told CNN.

The move by the FTC sees the commission’s chair, Andrew Ferguson, make good on comments he made in December, mere days before Trump nominated him for the job.

“We must prosecute any unlawful collusion between online platforms, and confront advertiser boycotts which threaten competition among those platforms,” then-Commissioner Ferguson said about a different case.

That’s exactly what Musk, who has spearheaded the president’s Department of Government Efficiency, has spent years accusing the progressive watchdog of doing, claiming Media Matters caused a coordinated mass exodus of advertisers by publishing the report.

In a Thursday statement, Angelo Carusone, the Media Matters president, said that the Trump administration has been “defined by naming right-wing media figures to key posts and abusing the power of the federal government to bully political opponents and silence critics.”

“It’s clear that’s exactly what’s happening here, given Media Matters’ history of holding those same figures to account,” Carusone said. “These threats won’t work; we remain steadfast to our mission.”

In 2024, a record number of advertisers were looking to cut their ad spending on X, as the platform is now known, citing concerns that the extreme content that has proliferated there since Musk’s takeover could damage their brands. Musk himself has buoyed conspiracy theories and hate speech with his own account. He also told advertisers that left the platform to “go f**k yourself.”

But advertisers began fleeing the social media platform nearly a year after Musk acquired Twitter in 2022, expressing concerns about the billionaire’s gutting of the platform’s content moderation team, mass layoffs, and uncertainty over the platform’s future. In July 2023, months before Musk sued Media Matters, the billionaire reported a 50% decline in Twitter’s ad revenue.

Since the exodus, Musk has sought to mend fences, looking to woo back advertisers via a charm offensive.

But that same year, Musk sued the Global Alliance for Responsible Media, a voluntary ad-industry initiative run by the World Federation of Advertisers, claiming that the group illegally coordinated an ad boycott against X. In February, Musk broadened that lawsuit to include Lego, Nestlé, Shell and several others.

Advertisers named in the lawsuit filed a motion last week to dismiss his suit, claiming that Musk was using it “to win back the business X lost in the free market when it disrupted its own business and alienated many of its customers.”

Additionally, in March, Media Matters sued Musk, claiming that he lodged several expensive lawsuits against the watchdog “for having dared to publish an article Musk did not like.”

Media Matters has seen similar probes before. In 2023, the progressive watchdog sued Ken Paxton, accusing the Texas attorney general of violating the First Amendment by investigating Media Matters’ reporting on Musk’s app, similarly arguing that it was being penalized for its reporting. The progressive watchdog won an injunction against the Texas attorney general in 2024.

The FTC declined to comment for this story. WFA did not respond to a request for comment on the probe.

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