Elon Musk’s social network X expanded its lawsuit against several companies, accusing them of participating in a coordinated advertising boycott that negatively affects the platform’s revenue. Filed last year, the original lawsuit included CVS, Mars, Ørsted and Twitch. The new version adds big brands such as Nestlé, Abbott Laboratories, Colgate-Palmolive, Lego, Pinterest, Tyson Foods and Shell International to the list.
The amended version of the lawsuit was filed by Musk’s attorneys on Saturday, and accuses the Global Alliance for Responsible Media (GARM), along with its member companies, of violating antitrust laws.
The lawsuit alleges that GARM and its members pressured X to adopt certain brand safety standards favoured by the group and, when it failed to meet their expectations, withdrew its ad investment. According to the lawsuit, at least 18 advertisers that were part of GARM stopped buying ads on Twitter – either in the U.S. or globally – in the weeks after Musk bought the platform in November 2022, while other GARM members “substantially reduced” their ad spending on the platform.
Musk’s lawyers noted that these actions affect competition in the marketplace and seek to impose collective standards that do not necessarily represent the interest of consumers. “But collective action among competing advertisers to dictate brand safety standards to be applied by social media platforms shortcuts the competitive process and allows the collective views of a group of advertisers with market power to override the interests of consumer,” the complaint said.
X also alleged that it was deprived of billions of dollars in ad revenue, pointing out that the ramifications of the boycott are still being felt years later.
GARM was founded in 2019 as part of The World Federation of Advertisers (WFA) to develop and promote brand safety guidelines for online advertisers to ensure their ads don’t appear alongside harmful or controversial content. However, it was shut down by WFA following the antitrust lawsuit filed by X.
X’s lawsuit last year came a day after a federal judge in the U.S. ruled that Google broke the law with monopolistic behaviour over online search and related advertising. The State Department’s lawsuit demanded that the company be forced to stop its alleged abuse of dominance practices and that “necessary structural measures” be taken to remedy any anticompetitive harm.
