A U.S. District Judge has dismissed a lawsuit filed by Elon Musk's X Corp, which alleged that several major advertisers conspired to boycott the platform. The lawsuit claimed that companies including Unilever, Mars, renewable energy firm Orsted, and the World Federation of Advertisers (WFA) had collectively deprived X of "billions of dollars" in advertising revenue.
In her ruling, Judge Jane Boyle stated that X Corp did not provide sufficient evidence to demonstrate any harm under federal competition laws. The lawsuit, initiated in a Texas court in 2024, followed a notable decline in advertising revenue for X after Musk's acquisition of Twitter in 2022.
Since taking ownership, Musk implemented significant changes to the platform, including the reinstatement of accounts associated with controversial figures and the relaxation of various content restrictions. Subsequently, within a year, advertising revenues plummeted by more than half as numerous companies curtailed their advertising activities on the platform.
The legal action claimed that the accused advertisers had acted against their economic interests, thereby breaching U.S. antitrust laws which are designed to encourage fair competition. Musk had publicly expressed his frustration, stating: "We tried being nice for 2 years and got nothing but empty words. Now, it is war."
X Corp contended that the defendants unfairly restricted their advertising spending by adhering to guidelines established by a WFA initiative known as the Global Alliance for Responsible Media (Garm), which aims to tackle illegal or harmful content on digital media platforms and ensure responsible monetization through advertising.
In response, CVS and the other defendants refuted any claims of wrongdoing. They filed counterarguments urging Judge Boyle to reject the lawsuit, asserting that their advertising decisions were made independently and that X Corp had not effectively demonstrated otherwise.
Judge Boyle aligned with the defendants' perspective, stating in her opinion that Garm neither purchased advertising space from X to resale to advertisers nor instructed X to refrain from selling directly to Garm's clients. She concluded, "The very nature of the alleged conspiracy does not state an antitrust claim, and the court therefore has no qualm dismissing with prejudice."
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