A far-left ‘media’ organization that is a favorite of the Democratic Party is facing hard times like never before, much to the delight of conservatives.
Media Matters, the far-left self-proclaimed ‘media watchdog’ known for targeting what it calls “conservative misinformation,” is reportedly teetering on the brink of bankruptcy due to mounting legal battles involving the federal government, tech billionaire Elon Musk, and others.
According to The New York Times, the organization—historically backed by major Democratic donors—has accumulated over $15 million in legal expenses in recent months defending itself against multiple lawsuits. Legal actions have been brought by the Federal Trade Commission, several state attorneys general, and Elon Musk.
As a result, Media Matters has been forced to downsize its staff, with internal documents and 11 sources familiar with the situation confirming the cutbacks to The Times. The group’s leadership is now scrambling to raise funds from increasingly hesitant donors.
Musk’s company, X Corp, filed a defamation lawsuit against Media Matters in November 2023 in the U.S. District Court for the Northern District of Texas. The suit alleges the group falsely claimed that ads from major brands—including Apple, IBM, and Oracle—were appearing next to pro-Nazi and antisemitic content on the platform, the Times reported.
X alleges that Media Matters “knowingly and maliciously” manipulated its algorithm by using test accounts that followed select users and repeatedly refreshed their feeds to create screenshots showing ads next to extremist content—misrepresenting what an average user would typically encounter on the platform.
According to the report, Media Matters has made multiple attempts to settle with Elon Musk, offering various “concessions,” but the two sides remain “far apart,” and the latest round of talks collapsed. Facing mounting legal costs, the organization has internally discussed shutting down as a “last resort,” based on interviews and an internal document reviewed by The New York Times. Publicly, however, Media Matters insists it has no plans to close and remains committed to fighting the lawsuits.
Despite the public denials, insiders have conceded that Media Matters has scaled back its work and is being “frozen out” by some allies. “And it has faced plummeting staff morale, rising infighting and security concerns,” the New York Times reported.
