The X social media platform has extended a lawsuit alleging an advertising boycott by some major companies to food and beverages giants Nestlé and Tyson Foods.
First launched in August, the case was expanded over the weekend to also include infant-formula maker Abbott Laboratories, and outside of the food industry, to Shell, Colgate-Palmolive, Lego and Pinterest.
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X alleges a raft of companies conspired with the World Federation of Advertisers (WFA) and its affiliated body, the Global Alliance for Responsible Media (GARM), to pull advertising after the then Twitter platform was acquired by Elon Musk in 2022.
“In 2022, WFA knew that Twitter was vulnerable to an advertiser boycott by GARM-member advertisers and advertising agencies, as public reports indicated that ninety per cent of Twitter’s revenue was derived from advertising,” a court document filed with the Wichita Falls division for the northern district of Texas read.
It added: “WFA was concerned that Musk’s acquisition of Twitter could mark a change in Twitter’s implementation of, and adherence to, the GARM Brand Safety Standards.
“WFA organised 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.”
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By GlobalDataJust Food has asked the WFA, Nestlé, Tyson and Abbott to comment on the extension of the X lawsuit proceedings, first broadcast by the Wall Street Journal on Saturday (1 February).
WFA declined to comment.
GARM, meanwhile, has ceased operations but has not fully identified the reasons for its demise.
“GARM is a small, not-for-profit initiative, and recent allegations that unfortunately misconstrue its purpose and activities have caused a distraction and significantly drained its resources and finances,” according to a notice posted on its website last August.
“WFA therefore is making the difficult decision to discontinue GARM activities.”
Others consumer goods giants in food, Unilever and Mars, were also included in the initial lawsuit.
Unilever, however, reached a settlement with X in October.
Just Food has asked Mars to confirm what its current position is in the case.
The X court document continued: “As desired and intended by the conspirators, shortly after Twitter’s merger with the Musk-controlled entities, a substantial portion of Twitter’s existing advertising customers, including both GARM-member advertisers and advertising agencies, as well as advertisers who were clients of GARM-member advertising agencies, abruptly discontinued or sharply curtailed their purchases of advertising from Twitter.
“Between November 2022 and December 2022, at least eighteen GARM-member advertisers stopped purchasing advertising from Twitter either in the United States or worldwide.
“Of the remaining GARM-member advertisers that had been purchasing advertising from Twitter in October 2022, dozens more substantially reduced their purchases of advertising from Twitter (and then X) over the course of 2023, in many instances by over 70 per cent.”
