On Wednesday, a federal court ruled in favor of Elon Musk's X Corp in its case challenging California's content moderation laws, citing free speech violations. X Corp filed a lawsuit to block the controversial law, which took effect on January 1, 2024.

The legislation requires social media companies to disclose details of their content moderation policies to the state or face civil penalties.

The 9th US Circuit Court of Appeals in San Francisco overturned a previous lower court's decision that ruled against pausing enforcement of the state law. The panel of three judges decided the law facially violated the First Amendment, Reuters reported.

"X Corp. is likely to succeed in showing that the Content Category Report provisions facially violate the First Amendment," Judge Milan D. Smith, Jr. wrote in his case opinion.

In the complaint filed in Sept. 2023, X Corporation argued that Assembly Bill 587 violates the company's First Amendment rights because it pressures "companies such as X Corp. to remove, demonetize, or deprioritize constitutionally-protected speech that the State deems undesirable or harmful" which "interferes with the constitutionally-protected editorial judgments" of the company.

The suit alleged that the law "places an unjustified and undue burden" on social media companies. The lawsuit was originally dismissed by US District Judge William Shubb in December 2023.

Assembly Bill 587, signed into law last September, aims to tackle extremism, hate speech, and online misinformation. According to the law, online businesses that collect personally identifiable information from Californians must make their privacy policies easily available to the public, as reported by Forbes.

The lawsuit argued that the "true intent" of the legislation "is to pressure social media platforms to 'eliminate' certain constitutionally-protected content viewed by the State as problematic."

X's Global Government Affairs wrote, "Today, a bipartisan panel of judges unanimously ruled in favor of X and against a California law that seeks to regulate speech on social media platforms. This is not just a victory for our platform, but also for free speech nationwide. Whether in the United States or around the world, X will always fight for free speech and against government efforts to restrict people's right to express themselves."