Elon Musk Threatens Legal Action Over ‘Advertising Boycott Racket’ Targeting Right-Leaning Media

Elon Musk threatened legal action on Thursday against an alliance of major companies, accusing them of participating in an “advertising boycott racket” that has exacerbated a revenue decline at his social media platform, X.

Musk, who acquired the company formerly known as Twitter for $44 billion in 2022, made the announcement in response to a video of Daily Wire founder Ben Shapiro’s Congressional testimony. Shapiro’s testimony addressed alleged collusion by advertisers against right-leaning platforms.

“Having seen the evidence unearthed today by Congress, X has no choice but to file suit against the perpetrators and collaborators in the advertising boycott racket,” Musk wrote on X. “Hopefully, some states will consider criminal prosecution.”

Elon Musk’s threat follows Shapiro’s testimony before a House Judiciary panel during a hearing entitled “Collusion in the Global Alliance for Responsible Media (GARM).” GARM, an initiative by the World Federation of Advertisers (WFA), aims to tackle harmful content on digital media platforms and its monetization through advertising. WFA’s members, including Disney, Coca-Cola, Toyota, and Hershey, represent nearly 90% of global advertising spending, amounting to almost $1 trillion annually.

During the hearing, Shapiro and lawmakers focused on the conduct of GARM chief Robert Rakowitz. An interim House staff report highlighted Rakowitz’s questionable behavior, including an internal email from February 9, 2023, where Rakowitz appeared to boast about X being “80% below revenue forecasts” after GARM’s challenges on brand safety issues. Rakowitz claimed the email was a “self-effacing joke.”

The House report also unveiled biases against conservative media. An email exchange from October 2021 between Rakowitz and John Montgomery, EVP of global brand safety at GroupM, the world’s largest media buying agency, discussed blocking certain news outlets like Fox News, The Daily Wire, and Breitbart News. Montgomery admitted, “As much as we hated their ideology and bulls—t, we couldn’t really justify blocking them for misguided opinion,” but noted that they monitored these outlets closely and acted when they “crossed the line.”

In light of these revelations, Musk has urged for both civil and criminal repercussions. “Hopefully, some states will consider criminal prosecution,” Musk stated, highlighting the severity of the alleged collusion.

Representatives for GARM, GroupM, and X did not immediately respond to requests for comment on Musk’s post. Shapiro, in his opening statement shared by Musk, called on Congress to address what he termed as “censorship cartels like GARM and executive branch agencies” that oppose conservative views. The subcommittee is currently evaluating whether existing civil and criminal penalties, along with antitrust law enforcement efforts, are adequate to deter anti-competitive collusion in online advertising.

This development underscores the growing tension between major tech platforms, advertisers, and political entities over content moderation and free speech. Musk’s aggressive stance signals a potential legal battle that could have significant implications for the future of digital advertising and media bias.

As the situation evolves, the spotlight remains on whether the legal threats will materialize and how they might influence the practices of global advertisers and media platforms.