X is now suing more advertisers in an antitrust lawsuit focusing on what the company’s CEO Linda Yaccarino has claimed is a “systematic illegal boycott.”
The company formerly known as Twitter first filed the lawsuit against the World Federation of Advertisers and its brand safety initiative known as the Global Alliance of Responsible Media in August 2024.
Shortly afterwards, the WFA discontinued GARM, writing that “recent allegations that unfortunately misconstrue its purpose and activities have caused a distraction and significantly drained its resources and finances.” At the same time, the organization’s CEO reportedly told members that it would fight the lawsuit and “demonstrate our full adherence to competition rules in all our activities.”
X subsequently added advertisers including Twitch as defendants in the suit. Now, as initially reported by Business Insider, an amended complaint has expanded the suit even further to include Nestlé, Abbott Laboratories, Colgate, Lego, Pinterest, Tyson Foods, and Shell.
The complaint alleges that the WFA “organized an advertiser boycott of Twitter through GARM, with the goal of coercing Twitter to comply with the GARM Brand Safety Standards to the satisfaction of GARM.” And it claims that these efforts succeeded in harming Twitter/X, with “at least” 18 GARM-affiliated advertisers stopping their purchase of ads on Twitter between November and December 2022, with other advertisers “substantially” reducing their spending.
“The majority of X’s advertising revenue today comes from small- and medium-sized businesses that are not GARM members or clients of GARM-member advertising agencies,” the complaint says. “As demand for advertising on X has declined as a result of the boycott, the price X’s remaining advertisers are willing to pay has declined as well.”
In fact, the lawsuit claims that ad prices on X “remain well below those charged by X’s closest competitors in the social media advertising market,” so “by refraining from purchasing advertising from X, boycotting advertisers are forgoing a valuable opportunity to purchase low-priced advertising inventory on a platform with brand safety that meets or exceeds industry standards.”
The lawsuit isn’t the only place where executives have offered a pessimistic assessment of X’s business. The company’s owner Elon Musk reportedly told employees in January that “user growth is stagnant, revenue is unimpressive, and we’re barely breaking even.”
