Elon Musk’s X challenges finding social media company had to comply with Australian online safety notice

Elon Musk’s X Corp, previously known as Twitter, has launched a bid to overturn an Australian court’s finding it was obliged to comply with an transparency notice issued by the online safety regulator. The US-based social media giant challenged a $610,500 penalty imposed by Australia’s eSafety Commissioner in September 2023 after it missed a deadline to provide information on how it was addressing child sexual exploitation and abuse material on its platform. In the Federal Court, the company argued the compliance notice was issued to Twitter a month before that company ceased to exist, when Musk acquired the platform for $44 billion, and therefore was not obliged to respond. The argument was struck down in October last year by Justice Michael Wheelahan who found the company failed to show that it was not required to respond. However the case returned before a full bench of the Federal Court in Melbourne on Wednesday for an appeal against Justice Wheelahan’s judgment. X Corp’s barrister Bret Walker SC argued the Judge made a mistake in ruling the obligation to respond adequately to the notice continued after the merger of Twitter Inc and X Corp. Mr Walker said at the time of the merger Twitter Inc “ceased to exist” and the eSafety Commissioner would have been required to issue a new notice. “His Honour erred in not preferring to our main point,” he said. Mr Walker argued that while under US law X Corp assumed the “liabilities and benefits” of the previous entity, this could not be extended out to the unexpired period for that entity “to do something in compliance with a reporting process”. The eSafety Commissioner’s barrister Stephen Lloyd, on the other hand, argued Justice Wheelehan was correct in finding the notice to comply continued over to the new entity. “We’re not liable for any of its regulatory obligations, that seems to be the position of X Corp,” he said. “We say its plainly wrong and the trial judge is correct in rejecting it.” The court was told the Online Safety Act notice was provided to Twitter 21 days before it merged with X, requiring explanation on how the company had complied with Australia-imposed basic online safety expectations from January 2022 to January 2023. Reporting notices were sent to Discord, Google, TikTok, Twitch and Twitter asking them to explain measures they take to detect and address online child sexual exploitation and abuse material. X Corp did respond, however the commission argued the reply was inadequate and incomplete, sending out a letter with further questions to address. Justices Bernard Murphy, Natalie Charlesworth and Christopher Horan will hand down their judgment at a later date.