NIX Solutions: X Expands Lawsuit Over Ad Boycott

Last year, Elon Musk’s X (formerly Twitter) sued the World Organization of Advertisers (WFA) and its subsidiary, the Global Alliance for Responsible Media (GARM), accusing them of orchestrating a “systematic illegal boycott” of the platform. Now, X has expanded the list of defendants to include Nestlé, Colgate, Lego, Pinterest, and several other major companies.

NIX Solutions

Lawsuit Background and GARM Shutdown

X initially filed the lawsuit against WFA in August, alleging an illegal advertising boycott. Shortly after, WFA shut down GARM, citing the strain caused by “recent allegations that unfortunately misrepresent the organization’s purpose and activities.” Despite this, WFA’s leadership stated their intent to contest the lawsuit, asserting that they have always complied with competition regulations.

Expanded Lawsuit and Its Impact

Recently, X added more major advertisers to the lawsuit, including Nestlé, Abbott Laboratories, Colgate, Lego, Pinterest, Tyson Foods, and Shell. The lawsuit claims that WFA, through GARM, pressured advertisers to boycott Twitter in an attempt to enforce GARM’s safety standards. According to X, this effort was successful and significantly harmed the platform.

At least 18 advertisers linked to GARM reportedly stopped buying ads on Twitter between November and December 2022, while others drastically reduced their ad spending, reminds NIX Solutions. X argues that this boycott contributed to a decline in its advertising revenue, shifting its main income source to small and medium-sized advertisers who are not affiliated with GARM. As a result, X claims that the boycott led to a considerable drop in ad prices on the platform.

The case continues to unfold, and we’ll keep you updated as more details emerge.