Elon Musk Files X Lawsuit in North Texas Over Ad Boycott That Cost Billions

Elon Musk’s X Corp. has filed a lawsuit accusing an industry group of violating antitrust laws by pursuing an ad boycott that has cost the social media company billions of dollars.

The lawsuit, filed Tuesday in a Texas federal court, alleges that the Global Alliance for Responsible Media coordinated a 2022 advertiser boycott over concerns about whether X, formerly known as Twitter, would adhere to certain “brand safety” standards for content on the platform after Musk acquired it for $44 billion.

“Put simply, people are hurt when the marketplace of ideas is undermined and some viewpoints are underfunded over others through illegal boycotts,” X CEO Linda Yaccarino said in a post on the platform. “This behavior is a stain on an otherwise great industry and cannot be allowed to continue.”

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Outrage over unchecked anti-Semitic content and commentary on X — some of it endorsed by Musk — has prompted a number of major advertisers, including Apple Inc. and Walt Disney Co., to pull ads from the platform. And Musk has opposed government efforts to police toxic social media posts.

X’s lawsuit comes as House Republicans and conservative media have stepped up scrutiny of GARM, whose more than 100 members include advertisers Procter & Gamble Co. and Unilever Plc.

GOP lawmakers have accused GARM of violating antitrust laws, and the lawsuit cites a July report by the House Judiciary Committee that accused GARM of depriving conservative media outlets of advertising revenue from their members.

In its 2022 annual report, the industry group said it helped establish common definitions, metrics and tools to help brands and their advertising partners ensure their ads do not appear next to content they may deem problematic.

In its lawsuit, X claims that the group’s actions constitute “an open restraint of trade.”

“Concerning the collective efforts of competing advertisers to dictate the brand safety standards to be applied by social media platforms bypasses the competitive process and allows the collective views of a group of advertisers with market power to outweigh the interests of consumers,” Company X said in its complaint.

Musk, the world’s richest man, is a self-proclaimed defender of free speech on social media, and has taken other legal action over allegations of lax moderation of toxic posts, with varying degrees of success.

Video-sharing platform Rumble said it will file its own lawsuit against GARM and the World Federation of Advertisers in a Texas federal court, raising the same allegations as X.

The case is X v. World Federation of Advertisers, 7:24-cv-00114, U.S. District Court, Northern District of Texas (Wichita Falls).