Elon Musk’s X sues advertisers, says boycott violates antitrust law

Last fall, at the DealBook Summit, Elon Musk told advertisers to “fuck off,” and today he’s suing them for allegedly conspiring to boycott his social media platform X.

The lawsuit filed by X in Texas federal court names the World Federation of Advertisers, as well as individual companies Mars, CVS, Unilever and Orsted, a Danish clean energy company. Many of the companies pulled back when racist and anti-Semitic content began appearing on Twitter after Musk took over in the fall of 2022. They remained wary, with Musk himself amplifying controversial posts. The lawsuit does not claim that advertisers cannot boycott, but that they cannot collectively decide to do so.

“Defendants conspired with dozens of unindicted co-conspirators to collectively withhold billions of dollars in advertising revenue from Twitter (now X)…” the lawsuit reads. “Fearing that Twitter might deviate from certain brand safety standards for advertising on social media platforms established by GARM, the conspirators worked together to force Twitter to comply with those standards through a boycott.”

GARM is the global alliance for responsible media.

“This is an antitrust action involving a group boycott by competing advertisers of one of the most popular social media platforms in the United States,” X’s lawsuit reads. “The members of GARM ‘abruptly and unanimously boycotted Twitter, completely or significantly reducing their then-significant advertising purchases,’ calling it a conspiracy and collusion.”

The company is seeking a jury trial, “triple” damages, and an injunction, saying the boycott is still ongoing.

X said that brand safety standards are comparable to competitors and meet or exceed GARM parameters, but also that each social media platform should be free to set its own brand safety standards. He believes that “a free market would result in platforms with ineffective standards being left behind.”

Whether you believe it or not, what the lawsuit alleges is “a collective effort by competing advertisers to dictate the brand safety standards to be applied by social media platforms.”

“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 to promote their own economic interests through commercial restrictions at the expense of social media platforms and their users.”

The case is under active investigation by the Republican-led House Judiciary Committee, which emboldened the lawsuit by issuing an interim report concluding that “the extent to which GARM has organized its trade association and coordinated activities that deprive consumers of choice is likely to be inconsistent with antitrust law and threaten fundamental American freedoms.”

X described a major economic blow caused by the boycott. “X has become a less effective competitor to other social media platforms in selling digital advertising and in competing for user engagement on its platform. By sharply reducing revenues, the boycott has reduced X’s ability to invest in new or improved functionality, thereby harming consumers who use the X platform.”

X CEO Linda Yaccarino explained in a video and letter to advertisers posted on X why the platform is suing them — because they are disrupting the “marketplace of ideas” and also costing X billions of dollars.

“To those who broke the law, we say enough is enough. We are compelled to seek justice for the harm caused by these and potentially additional defendants, depending on what the legal process reveals.”