Elon Musk’s X Brings Antitrust Lawsuit Against GARM and Advertisers Over Boycott

Elon Musk’s X Brings Antitrust Lawsuit Against GARM and Advertisers Over Boycott

Elon Musk’s  X Corp. has filed an antitrust lawsuit against the Global Alliance for Responsible Media (GARM) and the World Federation of Advertisers (WFA) for conspiring to boycott the social media platform.

Musk warned earlier this month of his plans to sue GARM for targeting X due to its free speech policies. The lawsuit filed in Texas federal court alleges GARM and the advertisers conspired to “collectively withold billions of dollars” in advertising from X.

It also follows House Judiciary Committee hearings revealing a systematic effort to demonetize and deplatform conservative media outlets.

As Professor Jacobson and Kemberlee Kaye wrote here, while GARM holds itself out as an initiative established by the WFA to protect the public from “harmful content” on digital media platforms, it’s mostly an attempt at political and cultural censorship:

Bringing dozens of global brands together under one umbrella makes GARM particularly dangerous because collective action magnifies the impact. WFA members include global brands such as McDonald’s, Exxon, Visa, Adidas and dozens more.

…

GARM landed in the House Judiciary hot seat because it flagged conservative content as too risky or offensive for all its corporate members to run advertising on.

According to the House report: “Evidence obtained by the Committee shows that GARM and its members directly organized boycotts and used other indirect tactics to target disfavored platforms, content creators, and news organizations in an effort to demonetize and, in effect, limit certain choices for consumers.”

“We tried being nice for 2 years and got nothing but empty words,” Musk says in his X feed, where he also encourages other companies that have been boycotted to sue. The lawsuit means war on the advertisers:

We tried being nice for 2 years and got nothing but empty words.

Now, it is war. https://t.co/MEzH0vqz0p

— Elon Musk (@elonmusk) August 6, 2024

The alleged illegal boycott was triggered when Elon Musk acquired what was then Twitter in November 2022, according to the filing:

Pursuant to the conspiracy, major brand advertisers, including the advertiser Defendants and dozens of non-defendant co-conspirators, agreed to and did, abruptly and in lockstep, boycott Twitter by discontinuing entirely or substantially reducing their previously substantial advertising purchases from Twitter.

Before long, they bragged about their success:

Internally, GARM celebrated—and took responsibility for—the massive economic harm imposed on Twitter by the boycott, boasting within just a few months of the start of the boycott that “they [Twitter] are 80% below revenue forecasts.

GARM controls over 90 percent of spending in the global market, the complaint says. But “the brand safety standards set by GARM should succeed or fail in the marketplace on their own merits and not through the coercive exercise of market power by advertisers acting collectively” thereby violating antitrust law.

The real target of the boycott, though, is We the Users, X CEO Linda Yaccarino warned in a video announcing the lawsuit. It puts the global town square at risk:

People are hurt when the marketplace of ideas is constricted. No small group of people should be able to monopolize what gets monetized.

[*X is represented by Dhillon Law Group, where the author’s husband, Ron Coleman is Of Counsel.]

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