San Francisco sues Trump Media over alleged 'pay-to-play' Truth Social service

President social media company is facing a lawsuit from the city of San Francisco over a paid Truth Social subscription service that gives certain customers early access to the president's posts.

City Attorney David Chiu announced the lawsuit Tuesday, alleging that Trump Media's Truth API service operates as a "pay-to-play scheme," allowing subscribers to receive President Donald Trump's market-moving posts before they are publicly available. 

The lawsuit seeks to block the service and impose civil penalties under California's Unfair Competition Law (UCL). 

Chiu alleged the service gives wealthy subscribers an "unfair advantage" by providing early access to before it reaches the broader public.

"Truth Social has knowingly created a marketplace for insider trading by giving high-paying subscribers an unfair advantage over in the market," Chiu said at a news conference Tuesday. "It's a pay-to-play scheme for early access to the president's market-moving government decisions."

The monthly subscription was rolled out Aug. 1 and costs between $60,000 to $100,000 in exchange for early access to market-moving posts from Truth Social accounts with large followings, including Trumps own account.

"No ordinary person can pay that fee," Chiu said. "Now the early subscribers are largely high-frequency trading firms with the technology to analyze that information and to make trades within microseconds."

Chiu also said Trump owns roughly 41% of Trump Media and "is personally benefiting from this business scheme."

A Trump Media spokesperson pushed back on the allegations, telling Fox News Digital, "The people of California should outsource their future lawsuits to AI chatbots who, unlike the left-wing activists masquerading as attorneys who filed this lawsuit, will grasp the basic distinction between public and nonpublic information."

The lawsuit was filed Monday, the same day that dozens of former federal prosecutors and agents filed a court brief backing a separate lawsuit over Truth API, according to CBS News.

The separate lawsuit, brought by The Intercept and the Freedom of the Press Foundation, alleges the paid service violates the First and Fifth amendments.

A White House spokesperson referred Fox News Digital to Trump Media and The Trump Organization for comment.

Representatives for The Trump Organization and Chiu's office could not immediately be reached by Fox News Digital for comment.

Fox News Digital's Julia Bonavita contributed to this report.