X asks Ninth Circuit to revive data-scraping suit against hate speech monitor

Elon Musk sued the Center for Countering Digital Hate last year, claiming its reports led X to lose millions in ad revenue. SAN FRANCISCO (CN) — Elon Musk’s X asked a Ninth Circuit panel Wednesday to reverse a lower court’s finding that the First Amendment protects a nonprofit hate speech monitor’s activity.Peter Patterson of Cooper & Kirk, representing X, told the panel the case was about invasion of privacy and the economic harm caused by the Center for Countering Digital Hate’s reports about content on X, not free speech.Patterson argued damages are not prohibited under the First Amendment, because the center breached X’s terms of service when it “scraped” content from the platform for its reports.“The issue is not whether third parties reacted to speech; it's whether we're talking about specific economic harms versus reputational damages,” he said.The panel asked Patterson whether the center could be held liable for publishing true statements and could have predicted the lost advertising revenue caused by its reports.“It seems like you're sort of several steps downstream. They scrape the website, they get this information, they analyze the information, put out a report, people read the report, then they don't like X. This seems very attenuated for contract damage,” U.S. Circuit Judge Eric D. Miller, a Donald Trump appointee, said.Patterson argued the veracity of statements didn’t matter, and the center should have anticipated X’s business losses, because their goal is to “obtain data of this sort and publish reports causing these types of harm.”The appeals court judges were similarly skeptical about Patterson’s claims the lower court misunderstood the privacy violations caused by the center’s “scraping” public content from X, as any user can access public posts.“I don't understand your security of the platform argument, since all of that information is available to anybody who logs on to X,” Senior U.S. Circuit Judge Andrew D. Hurwitz, a Barack Obama appointee, said.Patterson spent the rest of his time on X’s claim the center violated the Computer Fraud and Abuse Act by accessing non-public data provided to the Dutch-based nonprofit European Climate Foundation via Brandwatch, a brand monitoring platform partnered with X. He argued sharing the foundation’s Brandwatch credential was prohibited.“We say these companies conspired together. So ECF conspired with a U.S. company, CCDH U.S., to target an American company's data in the United States … to harm that American company in the United States,” Patterson argued.However, the judges doubted there was unauthorized access into Brandwatch’s system.“I'm trying to figure out why it is that you've created any question about whether or not, from Brandwatch's perspective, this access was unauthorized. Indeed, its contract with ECF basically says it anticipates ECF may also have customers and other users and things like that,” Hurwitz said.Dennis Brandon Trice of Kaplan Martin, representing the center, asked the panel to affirm the lower court’s ruling, adding the judge correctly dismissed the suit under state anti-SLAPP statute.“As Judge Breyer recognized below, this case is about punishing defendants for their speech,” he said.Trice argued the center did not breach the terms of service of X or the European Climate Foundation, asserting the foundation “had a very good understanding” they could provide Brandwatch authorization to others.He asked the panel not to remand the case to allow X to amend their complaint, claiming Musk uses amendment to shut down adversaries.“Even rich plaintiffs are entitled to liberal amendment, aren't they?” Miller responded.Representatives for the parties did not immediately respond to a request for comment.U.S. Circuit Judge Jennifer Sung, a Joe Biden appointee, rounded out the panel.X originally sued the center in July 2023, accusing it of drawing advertisers away by showcasing the platform’s harmful content.X argued the center was funded and supported by unknown individuals and foreign governments and its reports caused harm by influencing advertisers not to do business on X, costing it millions in ad revenue.The center said the suit was a baseless attempt by X and Musk to silence free speech. U.S. Senior District Judge Charles Breyer dismissed the lawsuit in March 2024.“Sometimes it is unclear what is driving a litigation, and only by reading between the lines of a complaint can one attempt to surmise a plaintiff’s true purpose. Other times, a complaint is so unabashedly and vociferously about one thing that there can be no mistaking that purpose. This case represents the latter circumstance. This case is about punishing the defendants for their speech,” the Bill Clinton appointee wrote in his ruling. Follow @mhattridge_ Subscribe to our free newsletters Our weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts. Additional Reads