Copying the file to the usb drive didn't work for me. And also formatting to ntfs didn't.
What worked was to delete the usb partition and recreate it as mentioned in one of the comments here:
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Copying the Media Creation Tool to the USB drive worked for me but I was curious to try a few things.
It appears that running the Simple Volume Wizard fixes the problem without having to copy the Media Creation Tool to the USB drive.
This can be accessed in Computer Management > Disk Management.
Right click on the USB drive in the lower (graphical) part of the window and select Delete Volume.
Click Yes to the warning. If there are any volumes remaining, delete those also.
The entire USB drive should now show as Unallocated.
Right click on it again and select New Simple Volume.
Click through all the windows in the wizard using the default settings, selecting NTFS as the file system.
A new volume will be created.
Now run the Media Creation Tool without copying it to the USB drive.
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This worked for me but with one twist, I decided not to format the drive in NTFS. It was Fat32 and since this is the more compatible option I picked that over NTFS. I formatted the Stick and started the Media Creation Tool from my PC and this time it worked. I also had my Antivir and Firewall turned off during the entire process.