X Sues Ad Alliance and Major Brands Over Alleged Boycott Conspiracy
X, formerly Twitter, files lawsuit against global ad alliance and major companies, alleging unlawful conspiracy to boycott the platform. The suit claims billions in lost ad revenue due to coordinated actions.
Elon Musk's social media platform X has initiated legal action against a global advertising alliance and several prominent corporations, alleging an unlawful conspiracy to boycott the site. The lawsuit, filed in a Texas federal court on August 6, 2024, names the World Federation of Advertisers, Unilever, Mars, CVS Health, and Danish renewable energy company Orsted as defendants.
X claims that the defendants, acting through the Global Alliance for Responsible Media initiative, collectively withheld "billions of dollars in advertising revenue" from the platform. The company argues that this coordinated action violates U.S. antitrust law and goes against the economic interests of the involved parties.
Linda Yaccarino, X's chief executive, issued a statement regarding the lawsuit:
"People are hurt when the marketplace of ideas is constricted. No small group of people should monopolize what gets monetized."
The legal action comes in the wake of X's advertising revenue decline following Musk's acquisition of the platform in 2022. Many brands expressed caution due to rapid changes implemented under the new ownership.
X asserts that it has implemented brand safety standards comparable to its competitors, meeting or exceeding measures specified by the Global Alliance for Responsible Media. The initiative, launched in 2019, aims to address challenges related to harmful content on digital platforms and its monetization through advertising.
The lawsuit contends that X has become a "less effective competitor" in digital advertising sales due to the alleged boycott. The company is seeking unspecified damages and a court order to prevent any continued efforts to withhold advertising dollars.
This legal action highlights the ongoing challenges faced by X since its rebranding from Twitter. The platform has introduced numerous changes, including longer tweets, video calls, and a new verification system, while grappling with content moderation issues and financial difficulties.
As the case unfolds, it may have significant implications for the relationship between social media platforms and advertisers, potentially reshaping the digital advertising landscape.
