Social media platform X, previously known as Twitter, has initiated an antitrust lawsuit against the Global Alliance for Responsible Media (GARM) and several of its high-profile members, including major advertisers like Unilever, Mars, CVS Health, and Ørsted. The lawsuit alleges that these groups engaged in an “illegal boycott” that diverted billions of dollars in advertising revenue away from the platform.
GARM, founded in 2019 as part of the World Federation of Advertisers (WFA), was created to develop and promote brand safety guidelines for online advertisers. The organization aims to address the widespread issue of illegal or harmful content on digital platforms and prevent its monetization through advertising. GARM’s guidelines and initiatives have been influential in shaping how brands navigate advertising on platforms like X, especially ensuring that their ads do not appear alongside harmful or controversial content.
X’s lawsuit contends that GARM and its members, by collectively deciding to withhold advertising dollars from the platform, engaged in a coordinated effort that violates antitrust laws. The company claims that this alleged boycott has significantly harmed its business by cutting off a substantial portion of its ad revenue, which is crucial for the platform’s financial stability.
This legal action brings to the forefront the tensions between social media platforms and advertisers, particularly as concerns about brand safety and the responsibility of platforms to manage harmful content have become increasingly prominent.
X’s lawsuit could set a precedent in the ongoing debate over the power dynamics between digital platforms and the advertisers that fund them, as well as the role of industry groups like GARM in enforcing standards that impact the bottom lines of major tech companies.
X sues advertisers
X has filed an antitrust lawsuit against the Global Alliance for Responsible Media (GARM) and several prominent members in the District Court of Texas. The lawsuit, filed on Tuesday, August 6th, accuses GARM of orchestrating an advertiser boycott to compel X to comply with the organization’s stringent security and content standards.
X CEO Linda Yaccarino, in a post on the social network, referenced a report from the US House of Representatives Judiciary Committee, presented in July, which allegedly provides evidence of collusion orchestrated by GARM and its members against various companies, including X (formerly Twitter). According to Yaccarino, this coordinated boycott was designed to stifle the diversity of content and viewpoints available on X, thereby undermining the free circulation of ideas—a fundamental principle of the platform.
Yaccarino emphasized the severe financial impact of this alleged boycott on the company, stating,
“The illegal behavior of these organizations and their executives has cost X billions of dollars.” She further noted that the lawsuit is not solely about seeking financial compensation for the losses incurred but aims “to fix an ecosystem that allows such illegal activity.” This legal action marks a significant escalation in the conflict between X and the advertising industry. Elon Musk, the platform’s owner, echoes Yaccarino’s sentiments by declaring, “We tried peace for two years, now it’s war.”
This lawsuit is not the first time X has taken legal action against entities accused by Musk of driving advertisers away from the platform. Previously, X sued the Center for Countering Digital Hate (CCDH), an organization dedicated to combating hate speech online, after the CCDH published research claiming that X was failing to remove hateful content shared by subscribers adequately.
Additionally, X also filed a lawsuit against Media Matters, a watchdog group that reported X was displaying ads alongside Nazi and anti-Semitic content.
These legal battles underscore the broader struggle between X and various watchdog organizations, advertisers, and industry groups over the platform’s content moderation policies and the financial implications of those policies.
The outcome of this latest lawsuit could significantly impact the relationship between social media platforms and the advertising industry, particularly in how brand safety standards are enforced and the legal boundaries of coordinated actions by industry groups like GARM.
