X today filed a lawsuit against a group of major advertisers for allegedly conspiring to withhold advertising dollars from the social media platform, which, since Elon Musk’s acquisition, has been seen as more likely to host controversial content.
The lawsuit, filed in a Texas federal court, says dozens of advertisers followed the recommendation of a key advertising coalition, the Global Alliance for Responsible Media (GARM), to boycott ad buying on X since Musk bought the company. The suit says this turn of events cost the company billions of dollars in revenue. The suit seeks unspecified damages for violating U.S. antitrust law.
Right-wing video site Rumble, founded more than 10 years ago as an alternative to YouTube and positioned as a platform “immune to cancel culture,” announced Tuesday that it had filed a similar lawsuit“GARM was a conspiracy to perpetrate an advertising boycott of Rumble and others, and that is illegal,” the company said. posted on your account X.
The US House Judiciary Committee, which is controlled by Republicans and has expressed concerns about censorship of right-wing views on social media, has been investigating GARM. a preliminary report In July, the committee concluded that “the extent to which GARM has organized its trade association and coordinated actions that deprive consumers of choice is likely unlawful under antitrust laws and threatens fundamental American liberties.” X’s lawsuit relies heavily on internal GARM emails reviewed by the congressional panel.
In a video shared with XX CEO Linda Yaccarino said she was “shocked” by evidence uncovered by the House Judiciary Committee that there had been a “systematic illegal boycott of X.” Yaccarino attempted to cheer up X users with references to free speech in her statement. While pointing directly at the camera, she claimed advertisers were “targeting our company and you, our users,” and “threatening your global public square.”
“People feel hurt when the marketplace of ideas is restricted,” Yaccarino said.
The Brussels-based World Federation of Advertisers, which oversees GARM, did not immediately respond to a request for comment on the lawsuits. X’s suit also names Unilever, Mars, CVS and a Danish energy company as defendants, while Rumble’s suit also targets advertising agency WPP. Neither company immediately responded to requests for comment.
X’s lawsuit argues that in the past, advertisers had to reach individual agreements with social media companies to set limits on the types of content they would sponsor. Through GARM, advertisers have been able to pool their power, set industry standards for content moderation and enforce them. In X’s view, GARM now has too much influence over what content social media platforms can allow.
“In a competitive market, each social media platform would set the brand safety standards that are optimal for that platform and its users, and advertisers would unilaterally select the platforms on which they advertise,” The complaint states“But collective action among advertisers competing to dictate brand safety standards for social media platforms short-circuits the competitive process and allows the collective opinions of a group of market-powered advertisers to prevail over the interests of consumers.”
