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.