Topline
Billionaire Elon Musk’s social media giant X filed a lawsuit on Tuesday against a coalition of advertisers, claiming the organization broke federal antitrust laws by urging companies to boycott advertising on the platform, withholding billions of dollars in advertising revenue as Musk continues to butt heads with advertisers over his so-called free speech absolutism.
Social media platform X claimed in a new lawsuit that a major advertising coalition conspired to … [+]
Key Facts
The antitrust lawsuit was filed in federal court in Texas and lists the advertising coalition Global Alliance for Responsible Media (GARM), as well as several companies under its umbrella including Unilever, CVS Mars and Orsted, as defendants.
Plaintiffs allege those coalitions conspired with dozens of major advertisers, including CVS, Unilever and Orsted, to “collectively withhold billions of dollars” in revenue following Musk’s $44 billion purchase of the company in October 2022.
The suit stems from a condition on GARM’s membership, in which members agree to withhold advertising from platforms determined by the organization to be “non-compliant with the brand safety standards.”
Plaintiffs allege after Musk’s 2022 takeover, GARM told members it was concerned about X (then known as Twitter) meeting its safety standards, triggering a “massive advertiser boycott.”
The suit also cites a July report from the GOP-led House Judiciary Committee that claims GARM implemented a “shadowy corporate coordination” to convince advertisers to boycott the platform in an alleged effort to “deprive conservative media outlets and personalities” — Forbes has contacted GARM for comment.
CEO Linda Yaccarino said in a video she was “shocked” that companies allegedly “organized a systematic illegal boycott,” calling the scheme “just wrong,” and argued the alleged boycott “threatens our ability to thrive in the future” and puts the platform “at long-term risk.”
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Key Background
After months of negotiations, Musk—the world’s richest person—closed on a massive $44 billion deal for the social media company then known as Twitter in October 2022, vowing to commit the platform as a global marketplace for free speech with limited controls. In his first few months in charge, Musk changed the name of the company to X, reinstated controversial accounts, laid off thousands of employees and sparked a mass exodus of advertisers over concerns around lax content moderation. While Musk has sought to assuage advertisers by stepping down as CEO and expanding ad features, he has also put the blame on a handful of media companies for the loss of advertising revenue. Last September, he threatened to sue the Anti-Defamation League, claiming the group pressured companies against advertising, following an ADL report that found the platform had reinstated accounts that posted antisemitic content; the ADL said last October it would resume advertising on X. In November 2023, Musk sued left-wing watchdog Media Matters, accusing it of defaming X after several major advertisers—including Apple, Disney and IBM—pulled the plug on their advertising. In that suit, X alleges Media Matters created a “false impression” of how ads were displayed next to antisemitic and incendiary content, following a Media Matters report that found some ads were displayed beside pro-Nazi content. Later that month, Yaccarino slammed companies fleeing the platform, including Apple, Bravo and Oracle, as “detractors and fabricated distractions,” while Musk claimed those companies were “blackmailing” him with money.
Forbes Valuation
We estimate Musk is worth $223.2 billion, making the Tesla, X and SpaceX owner the world’s richest person, ahead of Amazon founder Jeff Bezos ($182.7 billion), Meta CEO Mark Zuckerberg ($175.3 billion), and LVMH magnate Bernard Arnault ($174.1 billion), according to Forbes’ real-time billionaires list.
Further Reading
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