NewsGuard Files Lawsuit Against FTC Over Alleged Censorship
Background of the NewsGuard and FTC Dispute
The Washington Post reports that NewsGuard, an organisation that provides credibility ratings and “nutrition labels” for news and information websites, has initiated legal proceedings against the Federal Trade Commission (FTC). This legal action follows a period of escalating tension between the ratings firm and federal regulators under the administration of President Donald Trump. NewsGuard, which was founded by journalists Steven Brill and Gordon Crovitz, operates by assigning trust scores to thousands of news outlets based on criteria such as transparency, accuracy, and the correction of errors. These scores are primarily used by advertising agencies and brands to ensure that their marketing budgets do not inadvertently support websites that spread misinformation or engage in deceptive practices.
The conflict reached a critical point when the FTC, led by Chairman Andrew Ferguson, reportedly intervened in the private contractual relationships between NewsGuard and its clients. According to the lawsuit, the FTC’s actions have significantly hindered NewsGuard’s ability to operate within the advertising technology ecosystem. The company alleges that the federal government is “strangling” its business model by actively discouraging or outright barring major industry players from utilising its services. This intervention is framed by NewsGuard as a form of state-sponsored censorship, as it prevents private companies from using third-party data to make informed decisions about where to place their advertisements.
The FTC, under the current administration, has frequently expressed concerns regarding the influence of “brand safety” firms. Critics within the commission have argued that such organisations act as gatekeepers that unfairly demonetise certain political viewpoints. Andrew Ferguson, who was appointed to the commission and subsequently elevated to the position of Chairman, has been a vocal critic of what he describes as the “censorship industrial complex.” The lawsuit filed by NewsGuard represents a significant escalation in the debate over the role of the government in regulating how private companies evaluate the reliability of information.
Key Developments in the Lawsuit
The primary catalyst for the lawsuit, as detailed by The Washington Post, was a specific directive issued by Chairman Andrew Ferguson. The FTC reportedly barred a major advertising agency, the identity of which remains central to the legal filings, from employing NewsGuard’s ratings in its media-buying processes. NewsGuard contends that this directive was not based on any violation of consumer protection laws or antitrust regulations, but was instead a politically motivated attempt to dismantle a service that the administration views as hostile to its interests.
In its legal filing, NewsGuard alleges that the FTC’s actions constitute a violation of the First Amendment. The company argues that its ratings are a form of protected speech and that the government cannot use its regulatory power to punish an organisation for the content of its evaluations. Furthermore, the lawsuit claims that the FTC has exceeded its statutory authority. Under the Federal Trade Commission Act, the agency is tasked with preventing unfair methods of competition and deceptive acts or practices. NewsGuard asserts that providing transparency tools to advertisers does not fall under these categories and that the FTC’s intervention is an unprecedented overreach into private commercial speech.
The Washington Post highlights that the lawsuit also focuses on the concept of “jawboning,” a term used to describe government pressure on private entities to suppress certain types of speech or business activities. NewsGuard alleges that the FTC’s communication with the advertising agency was coercive in nature, effectively forcing the agency to terminate its use of NewsGuard’s data to avoid regulatory retribution. This aspect of the case is expected to draw significant attention from legal experts, as it touches upon the boundaries of government influence over the private sector’s efforts to combat misinformation.
Impacts on the Advertising Industry
The FTC’s decision to bar a major agency from using NewsGuard ratings has sent ripples through the global advertising industry. For years, the industry has relied on “brand safety” and “brand suitability” tools to navigate an increasingly complex digital landscape. These tools are designed to protect brands from being associated with extremist content, hate speech, or demonstrably false information. By targeting NewsGuard, the FTC has introduced a high level of regulatory uncertainty for agencies and brands that prioritise these standards.
Industry analysts suggest that if the FTC’s position is upheld, it could fundamentally change how digital advertising is bought and sold. Agencies may become hesitant to use any third-party rating systems for fear of being accused of participating in “coordinated boycotts” or “unfair trade practices.” This could lead to a fragmentation of brand safety standards, where individual companies are forced to develop their own internal criteria without the benefit of independent, third-party verification. The Washington Post notes that some industry leaders are concerned that this will lead to an increase in ad placements on low-quality or deceptive websites, as the tools used to filter such sites are removed from the market.
Furthermore, the financial impact on NewsGuard itself is substantial. As a subscription-based service, the loss of a major advertising agency as a client represents a significant blow to its revenue stream. The company has stated that the FTC’s actions have created a “chilling effect,” making other potential clients wary of entering into agreements with NewsGuard. This economic pressure is at the heart of the company’s claim that the government is attempting to “strangle” it out of existence. The outcome of this lawsuit will likely determine whether brand safety firms can continue to operate as independent entities or if they will be subject to direct government oversight regarding their rating methodologies.
Reactions from Officials and Experts
The reaction to the lawsuit has been divided along ideological and regulatory lines. Supporters of the FTC’s actions, including several prominent figures within the Trump administration, argue that the commission is protecting the free market from “ideological cartels.” They contend that NewsGuard and similar organisations use their ratings to silence conservative voices by labelling them as unreliable, thereby depriving them of essential advertising revenue. From this perspective, the FTC’s intervention is seen as a necessary corrective to ensure that all media outlets have an equal opportunity to compete for ad dollars.
Conversely, free speech advocates and media experts have expressed alarm at the FTC’s tactics. Many argue that the government has no business telling private companies which data they can or cannot use to make business decisions. Legal scholars interviewed by various outlets have pointed out that if the government can bar an agency from using a news rating service, it could theoretically bar them from using any type of research or consultancy that the administration finds disagreeable. This, they argue, sets a dangerous precedent for state interference in the flow of information and the freedom of contract.
Chairman Andrew Ferguson has maintained that the FTC’s focus is on ensuring a fair and competitive marketplace. While he has not commented specifically on the pending litigation, his previous statements suggest a belief that the “brand safety” industry has evolved into a mechanism for political discrimination. The Washington Post reports that the FTC is expected to argue that its actions were taken to prevent “unfair methods of competition,” asserting that the collective use of NewsGuard’s ratings by major agencies constitutes a de facto boycott of certain news organisations.
Next Steps in the Legal Process
The lawsuit is currently in its initial stages, with NewsGuard seeking a preliminary injunction to prevent the FTC from enforcing its directive against the advertising agency. A federal judge will need to determine whether NewsGuard has a likelihood of success on the merits of its case and whether it will suffer “irreparable harm” if the FTC’s actions are allowed to continue during the litigation. This initial ruling will be a critical indicator of how the court views the balance between regulatory authority and First Amendment protections.
The discovery phase of the trial is expected to be extensive. NewsGuard’s legal team will likely seek internal FTC communications to prove that the decision to bar the ad agency was motivated by political animus rather than legitimate regulatory concerns. Conversely, the FTC will likely seek detailed information on NewsGuard’s rating methodology to support its claim that the company’s practices are unfair or discriminatory. The Washington Post indicates that this process could take several months, if not years, to reach a final resolution.
As the case moves forward, it is expected to draw amicus briefs from a wide range of stakeholders, including civil liberties groups, advertising trade associations, and media organisations. The final ruling could eventually reach the Supreme Court, as it addresses fundamental questions about the limits of administrative power and the definition of censorship in the digital age. For now, the advertising industry remains in a state of caution, awaiting further clarity on whether the tools they use to evaluate news credibility will remain legally permissible under the current regulatory framework. Details regarding the specific court dates and the presiding judge remain unclear at this stage of the proceedings.