The group known as SHARK (Showing Animals Respect and Kindness) says the entertainment agency that works with the Cheyenne Frontier Days Rodeo has filed suit against it.
Shark spokesman Steve Hindi says all his group had done was "educate" the band about what went on at the rodeo.
He said the band and another peformer, American country pop singer Carrie Underwood, cancelled after watching a 2007 video compiled by the group showing what it considered to be inhumane treatment of animals at the CFD rodeo.
"The only people to blame for cancelled acts at CFD is the rodeo organizers themselves," Hindi said.
"This lawsuit is a ludicrous attempt to stifle our freedom of speech, as the rodeo industry knows that the truth can only hurt them."
Hindi travelled from Illinois to Wyoming to address a public meeting after Matchbox Twenty's cancellation, to explain the group's position.
He said he did not want to see an end to the rodeo, just modifications to some events to make it more humane. Some of the events in question had already been removed from some rodeos.
The group also wanted to see the Professional Rodeo Cowboys Association and CFD follow their own animal protection rules.