Major advertisers sued for ‘Illegal Boycott’ by X

Top 3 Key Points:

1. X accuses major advertisers of an illegal boycott.
2. The lawsuit targets Unilever, Mars, CVS, Ørsted, and others.
3. X alleges the boycott aims to coerce compliance with safety standards.

X, the company formerly known as Twitter, is suing a group of major advertisers for allegedly organizing an illegal boycott against the platform. The lawsuit, filed on Tuesday, names Unilever, Mars, CVS, Ørsted, and several other brands, accusing them of collectively withholding billions in advertising revenue through a World Federation of Advertisers (WFA) initiative.

The WFA’s initiative called the Global Alliance for Responsible Media (GARM), requires companies to stop advertising on social platforms that don’t meet its safety standards. X claims that GARM organized a boycott to force X into compliance with these standards, even though X had recently announced its intention to rejoin GARM.

X CEO Linda Yaccarino, in a video posted on the platform, stated, “The evidence and facts are on our side. They conspired to boycott X, threatening our future. This puts your global Town Square, a place for free and open expression, at risk.”

Elon Musk also encouraged other companies facing similar boycotts to sue, suggesting potential “criminal liability” under the Racketeer Influenced and Corrupt Organizations (RICO) Act, which targets organized crime.

The lawsuit references a July 10th report from the House Judiciary Committee, which criticized the WFA and GARM for their efforts to demonetize certain content. Earlier, House Judiciary Chair Jim Jordan sent letters to 40 companies involved with GARM, questioning their boycotts of right-wing outlets.

However, the success of X’s lawsuit is uncertain. Techdirt notes that choosing where to advertise is protected by the First Amendment. The ad tech watchdog group Check My Ads supports this view, stating advertisers have the right to avoid platforms that promote hate and conspiracies.

X is asking the court to declare the advertisers’ actions illegal and to award damages. This lawsuit is the latest in a series of legal actions by Musk, who recently dropped a lawsuit against OpenAI but filed another against them on Monday, claiming manipulation in the founding of the nonprofit.