Social media companies X and Rumble sued an advertising trade group and its members on Tuesday, alleging that the coalition engaged in anti-competitive activity to facilitate boycotts and force tech platforms to censor content.
X is suing the World Federation of Advertisers, the group behind the Global Alliance for Responsible Media (GARM), in the U.S. District Court for the Northern District of Texas. GARM allegedly forced its members — a roster that includes most major ad buyers — to enforce “safety” standards that required not running ads alongside “misinformation.” The alliance facilitated a boycott of X following Elon Musk’s acquisition of the company, a boycott which, X’s lawsuit claims, was only made possible by collusion.
“No small group of people should be able to monopolize what gets monetized,” X CEO Linda Yaccarino said.
“GARM celebrated—and took responsibility for—the massive economic harm imposed on Twitter by the boycott, boasting within just a few months of the start of the boycott that ‘they [Twitter] are 80% below revenue forecasts,’” the X lawsuit reads.
The House Judiciary Committee obtained documents, used in the lawsuit, which suggested that GARM and its members targeted conservative news outlets and used rules about “misinformation” as a pretext to financially harm platforms whose ideology they did not like.
The Rumble suit, filed by the same lawyers in the same court as the X lawsuit, named the World Federation of Advertisers as well as advertising mega-firm WPP and its subsidiary GroupM.
“In a competitive market, advertising agencies would compete with one another on their ability to place their customers’ ads according to their customers’ individual preferences and marketing plans,” it said. Instead, “GARM uses the market power of its members and their clients to force platforms to submit to GARM’s demands.”
In a statement, Rumble called GARM an “advertising cartel.”
Emails reveal that Joe Barone, GroupM’s Managing Partner Brand Safety Americas, admitted the group had “Daily Wire on our Global High Risk exclusion list, categorized as Conspiracy Theories.” In an email to Rakowitz, GroupM Executive Vice President of Global Brand Safety John Montgomery admitted that the group did not find that The Daily Wire published misinformation.
GroupM CEO Christian Juhl testified opposite Daily Wire co-founder Ben Shapiro in a House hearing on the topic, and struggled to explain the emails. He was replaced as CEO soon after.
The advertising industry is quite concentrated, and GARM served to eliminate whatever remained of competition, the suit says. Six multinational firms, known as the “Big Six,” are the parent companies of almost every major company that purchases ads, working as middlemen on behalf of the companies that have products to promote. GARM counted those firms and others among its members, and allowed them to speak with one voice.
That served to effectively threaten platforms: unless they censored content as vigorously as GARM demanded, they might lose almost all their advertisers.
GARM is led by Rob Rakowitz, a former executive with Mars Corp., the Virginia-based candy-maker. Mars is one of four companies that comprise GARM’s “steer team,” along with Orsted, CVS Health, and Unilever. All four are named in the X lawsuit.
Emails suggest that GARM’s members were at times reluctant to withhold their advertising dollars, and sought assurances from GARM that other companies were doing the same. In some cases, individual companies used GARM as a mouthpiece for their own pet issues.
In November 2022, Orsted wrote to GARM, “I’m reaching out to you to ask you if it’s possible to arrange a meeting and hear more about your perspectives about the Twitter situation and a possible boycott from many companies…we are about to make a recommendation to management about actions and when we need to consider whether we should continue promotion on the platform or find alternatives.”
Orsted ultimately removed all advertising from X “due to brand safety concerns.” At least 18 GARM members did the same, and others removed almost all their advertising, the suit said. In March 2023, Orsted wrote to GARM, “some time has passed, and I am curious to know what you would advise us to do. And what are other global advertisers doing – have they come back to the platform, or are they still off?”
The Daily Wire and The Federalist are suing the State Department, also in federal court in Texas, for allegedly backing private firms such as Newsguard and the Global Disinformation Index, which also sought to financially harm conservative news outlets.
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