Elon Musk's social media platform X is dragging a media watchdog group to court ... claiming Media Matters is engaged in a smear campaign against him and his company. The billionaire followed up Monday with his previously announced plans to sue Media Matters in response to a recently published story suggesting pro-Nazi advertisements were running alongside organic user content ... an assertion Elon claims is BS. ANALYSIS: The root cause of X having antisemitic content next to Ads seems to be that X’s automated Ad Adjacency tools aren’t able to determine if the content in images is antisemitic. Additionally, X’s recent decision to help users monetize on Ads that run on users profiles is… https://t.co/M3kr8WXEEZ pic.twitter.com/S7UU84YZkr According to the lawsuit, obtained by TMZ, Media Matters "knowingly and maliciously manufactured" side-by-side images depicting advertisements next to neo-Nazi and white nationalist posts on his X app, formerly Twitter. X claims Media Matters is driving advertisers from Elon's platform by passing off the images as something the typical X user might encounter on the app ... something Musk says is far from true. What's more, X alleges Media Matters went to great lengths to manipulate the X algorithm to create situations where paid posts from huge companies would appear next to racist and incendiary content. X says Media Matters then took screenshots of the posts as the basis of a negative story ... "leaving the false impression that these pairings are anything but what they actually are: manufactured, inorganic, and extraordinarily rare." The suit says it's all part of a wide-ranging smear campaign Media Matters is mounting against Elon and X ... claiming the group is hellbent on driving advertisers away from the platform in order to destroy Elon's company. The split second court opens on Monday, X Corp will be filing a thermonuclear lawsuit against Media Matters and ALL those who colluded in this fraudulent attack on our company pic.twitter.com/55vl7PspaQ As we reported ... Elon announced Friday plans to file a "thermonuclear" lawsuit against Media Matters for what he says was a "fraudulent attack" on his app. There's lots of reasons Elon's pissed ... including the fact the Media Matters report seems to have spurred a mass exodus among HUGE companies advertising on X. Media Matters is not backing down though ... its president, Angelo Carusone, tells TMZ ... "This is a frivolous lawsuit meant to bully X’s critics into silence. Media Matters stands behind its reporting and looks forward to winning in court." Stay tuned ...