Legal News for Mon 12/9 - Infowars Social Media Accounts, TikTok's Bid to Block a Ban, and Google Sues the CFPB

Minimum Competence

This Day in Legal History: Florida Recount Stayed

On December 9, 2000, the U.S. Supreme Court issued a 5-4 decision to stay the recount of presidential election votes in Florida, a pivotal moment in one of the most controversial elections in American history. The recount had been ordered by the Florida Supreme Court after a contentious election between George W. Bush and Al Gore left the outcome hinging on Florida’s 25 electoral votes. The Supreme Court’s stay temporarily halted efforts to resolve disputes over "hanging chads" and other ballot irregularities in a highly scrutinized manual recount process.

This pause set the stage for the landmark decision in Bush v. Gore three days later. On December 12, the Court ruled that the recount violated the Equal Protection Clause of the Fourteenth Amendment, effectively ending the process and cementing George W. Bush’s victory. The Court's majority held that varying standards for counting votes across Florida counties were inherently unequal, and there was insufficient time to establish uniform procedures before the Electoral College deadline.

The decision was deeply divisive, with the dissenting justices arguing that halting the recount undermined public confidence in the democratic process. Critics of the ruling contended that it set a dangerous precedent by involving the judiciary in the electoral process, while supporters claimed it ensured a timely resolution in an unprecedented situation. Ultimately, the ruling awarded Bush the presidency by a margin of just 537 votes in Florida.

The case has since been a flashpoint for debates about judicial impartiality and election integrity. It underscored the significance of state-level election laws and highlighted vulnerabilities in the U.S. electoral system that continue to shape legal and political discourse today.

A legal showdown involving Alex Jones’ Infowars, Elon Musk’s X Corp., and The Onion centers on the ownership and transfer of social media accounts in bankruptcy proceedings. Infowars is being sold to The Onion’s parent company, Global Tetrahedron LLC, as part of Jones’ bankruptcy to cover $1.4 billion in defamation judgments owed to Sandy Hook families. However, X Corp. has filed objections, asserting that it owns Infowars’ accounts under its terms of service and has the right to control their transfer or use.

The Onion’s winning bid, supported by some Sandy Hook families who agreed to defer payments, is under scrutiny for its structure and fairness. Judge Christopher Lopez will decide whether X’s claim to ownership under its terms of service—which prohibits account transfers without consent—supersedes the bankruptcy estate's right to sell interests in the accounts. X’s lawyers argue that the accounts are licenses, not assets, and therefore cannot be transferred. This legal stance aligns with prior cases that emphasized the authority of social media companies’ terms of use.

This dispute highlights X’s aggressive stance under Musk’s leadership in asserting control over account transfers, even as it risks alienating users. The case also raises broader questions about the transferability of accounts on other platforms, like Gab and Truth Social, which may have similar restrictions. The outcome could set precedent in determining how social media accounts are treated in bankruptcy, a legal area still in its infancy.

US judge weighs fate of the Onion's buyout of Infowars | Reuters

Musk Flexes Muscle to Stop Infowars' X Account Sale to The Onion

ByteDance, the Chinese parent company of TikTok, and the app itself have requested a temporary halt to a U.S. law requiring ByteDance to divest TikTok by January 19, 2025, or face a ban. The companies filed an emergency motion with the U.S. Court of Appeals for the District of Columbia, seeking relief while they petition for a review by the U.S. Supreme Court. They argue that the law would force TikTok, a major platform with over 170 million monthly U.S. users, to shut down just before a presidential inauguration.

The divestment law, passed earlier in 2024, reflects ongoing concerns over national security risks linked to TikTok’s ownership by a Chinese company. ByteDance contends the law undermines free speech and harms millions of American users and creators who rely on the platform for communication and income. The court’s decision will determine whether the app remains operational during the Supreme Court review process.

ByteDance, TikTok seek temporary halt to US crackdown law pending Supreme Court review | Reuters

The Consumer Financial Protection Bureau (CFPB) has asserted supervisory authority over Google Payment Corp., a subsidiary of Alphabet Inc., as part of expanding oversight of nonbank financial platforms. This decision could lead to regulatory exams, though it does not imply any misconduct by Google. The CFPB stated that Google Payment Corp. meets the legal criteria for supervision, citing potential consumer risks linked to remaining balances in discontinued Google Pay accounts.

Google quickly filed a lawsuit challenging the CFPB's authority, calling the move an example of government overreach. The company argues that the U.S. version of its Google Pay peer-to-peer payment service no longer exists and has posed no risks to consumers. Google contends that the CFPB's decision is legally flawed and lacks justification.

The case reflects ongoing tensions between tech companies and financial regulators as agencies like the CFPB increasingly focus on nonbank platforms. While the CFPB has been criticized for underusing its authority in this area, Google’s response highlights concerns about regulatory overreach and its impact on innovation.

CFPB Claims Supervision Over Google Unit, Which Promptly Sues

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