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Supreme Court blocks Texas law targeting social media companies

The Supreme Court on Tuesday blocked a Texas law requiring social media sites to post all content that expresses a "viewpoint," in at least a temporary victory for sites like Meta’s (FB) Facebook and Instagram.

The high court handed down the decision that grants an emergency request from tech industry lobbyists to block the law HB 20, which would hinder the sites' ability to take down content as they see fit. Justice Elena Kagan voted to deny the application to vacate stay, though separately from Justices Samuel Alito, Clarence Thomas, and Neil Gorsuch who joined in a dissenting opinion.

The law, HB 20, the first of its kind in the U.S., was pushed by Republican lawmakers who contend that social platforms muzzle conservative voices. That's a sentiment echoed by Republican lawmakers in Florida who also passed legislation to protect posts by politicians and journalists, as well as certain Republican members of Congress.

Industry lobbyists NetChoice and Computer and Communications Industry Association, which represent dozens of social media companies, apps, and other tech companies, including Yahoo, challenged the Texas statute on First Amendment and other grounds. The request followed the 5th Circuit Court of Appeals' decision to reinstate the law after a federal district court found it unconstitutional and granted an injunction to stop its enforcement.

Facebook CEO Mark Zuckerberg testifies during a remote video hearing held by subcommittees of the U.S. House of Representatives Energy and Commerce Committee on
Facebook CEO Mark Zuckerberg testifies during a remote video hearing held by subcommittees of the U.S. House of Representatives Energy and Commerce Committee on "Social Media's Role in Promoting Extremism and Misinformation" in Washington, U.S., March 25, 2021. U.S. House of Representatives Energy and Commerce Committee/Handout via Reuters (Handout . / reuters)

The decision handed down Tuesday vacates the 5th Circuit's ruling, effectively putting the law on hold while the tech industry fights it in court.

“This ruling means that private American companies will have an opportunity to be heard in court before they are forced to disseminate vile, abusive or extremist content under this Texas law. We appreciate the Supreme Court ensuring First Amendment protections, including the right not to be compelled to speak, will be upheld during the legal challenge to Texas’s social media law," Matt Schruers, president of the Computer and Communications Industry Association, said in a statement on Tuesday.

In his dissent, Alito stressed the importance of states' independence.

"While I can understand the Court's apparent desire to delay enforcement of HB 20 while the appeal is pending, the preliminary injunction issued by the District Court was itself a significant intrusion on state sovereignty, and Texas should not be required to seek pre-clearance from the federal court before its laws go into effect," Alito wrote.

The decision levels a split in legal authority over whether the First Amendment’s speech protections can be used force social media companies to allow users to post on their platforms without any restraints.

On May 23, a three-judge panel for 11th Circuit Court of Appeals issued an order unanimously blocking the enforcement of a majority of Florida law SB 7072 that limited social media companies’ rights to boot users off their platforms and tweak political candidates’ posts. Big Tech lobby group NetChoice challenged the statute.

William Jay, an attorney with Goodwin Procter, tells Yahoo Finance that the 11th Circuit's decision may have played a crucial role in the Supreme Court's ruling.

"It's just-in-time disagreement with the 5th Circuit suggests that this really could be a case the Supreme Court might review on the merits. That likely was important to several members of the 5-Justice majority.”

The Supreme Court’s ruling comes from its controversial so-called shadow docket, in which the justices make a decision without allowing both sides to file briefs and make arguments.

Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on Twitter @alexiskweed.

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