X and Rumble Sue Advertising Coalition Over Alleged Antitrust Violations

Social media companies X (formerly Twitter) and Rumble have filed lawsuits against an influential advertising trade group and its affiliates, alleging anti-competitive practices aimed at enforcing content censorship. The legal actions target the World Federation of Advertisers (WFA) and its Global Alliance for Responsible Media (GARM) in the U.S. District Court for the Northern District of Texas.

The lawsuits claim that GARM, described as an "advertising cartel," coerced its members, including major ad buyers, to boycott platforms like X following Elon Musk’s acquisition. The lawsuit argues that this boycott was enabled by collusion among the members to enforce "safety" standards, which included not advertising alongside "misinformation."

• Impact on X: X's CEO, Linda Yaccarino, criticized the alliance, stating, “No small group of people should be able to monopolize what gets monetized.” The lawsuit cites documents obtained by the House Judiciary Committee indicating that GARM used its influence to target conservative news outlets under the guise of combating misinformation. The alliance allegedly celebrated the economic damage inflicted on X, claiming that the platform fell 80% below revenue forecasts due to the boycott.

• Rumble's Allegations: Filed alongside X’s lawsuit, Rumble’s suit names the WFA, advertising giant WPP, and its subsidiary GroupM. It accuses these entities of leveraging their market power to force platforms into compliance with GARM’s demands, rather than competing based on their ability to cater to individual advertisers’ preferences.

Emails included in the lawsuits reveal internal communications where executives at GroupM admitted to categorizing conservative outlets like The Daily Wire as "high risk" despite acknowledging that the outlet did not disseminate misinformation. This has raised questions about the motivations behind GARM’s standards and the true intent of their advertising guidelines.

• The "Big Six" Influence: The lawsuits highlight the concentration of power within the advertising industry, dominated by six multinational firms known as the "Big Six." These firms, along with other GARM members, allegedly threatened platforms with significant advertising revenue losses unless they adhered to strict content censorship requirements. This effectively stifled competition and allowed GARM to dictate terms across the industry.

• Corporate Dynamics: GARM's leadership includes executives from companies like Mars Corp., CVS Health, and Unilever. Internal emails suggest some members were hesitant to participate in boycotts and sought confirmation from GARM that other companies were taking similar actions. In one email from Orsted, a member of GARM’s “steer team,” the company sought guidance on whether to continue advertising on X amid the ongoing boycott.

The lawsuits also draw parallels to separate legal actions involving The Daily Wire and The Federalist, which are suing the State Department for allegedly supporting private firms like Newsguard and the Global Disinformation Index in efforts to financially harm conservative outlets.

These legal battles highlight the ongoing struggle over free speech and the power dynamics within the advertising industry. As the cases proceed, they will likely bring increased scrutiny to the relationships between advertisers, social media platforms, and the content they choose to support.

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