The investigation comes on the heels of an antitrust lawsuit filed by X in August, accusing GARM and its suburbanization, the World Federation of Advertisers, of orchestrating a coordinated boycott to withhold advertising revenue from platforms that do not adhere to GARM’s “Brand Safety Standards.” The investigation seeks to determine whether the groups violated antitrust laws by colluding to disadvantage platforms such as X and Rumble, a video-sharing platform favored by conservatives.

In a statement, Paxton criticized the Biden administration as failing to enforce antitrust laws against its perceived political allies.

“Trade organizations and companies cannot collude to block advertising revenue from entities they wish to undermine,” Paxton said, adding that such practices threaten free market competition.

X’s lawsuit, filed in federal district court in Texas, alleges that GARM members, including Mars, CVS, Unilever, and Danish energy firm Orsted, acted in concert to enforce brand safety standards through a “naked restraint of trade” at the expense of social media platforms. The suit also claims that these actions were not in the advertisers’ individual economic interests but were instead part of a collective effort to pressure platforms such as X into compliance.

Rumble joined X in the lawsuit, accusing GARM of imposing “one-size-fits-all” standards that led to boycotts of alternative platforms. Both companies are seeking an injunction to prevent further coordination among advertisers, as well as damages and legal fees.

Investigation follows GARM’s downfall

The controversy surrounding GARM reached a tipping point in August when Musk’s lawsuit prompted WFA to announce GARM’s shutdown. In a statement, WFA described GARM as a “not-for-profit initiative” and blamed its closure on a “distraction” caused by allegations of collusion.

GARM was originally established in 2019 following the Christchurch mosque shootings in New Zealand to promote transparency and responsible advertising in digital media. However, critics, including Musk, argued that its brand safety standards became a tool for censorship and anticompetitive practices.

X alleged that GARM members “abruptly and in lockstep” pulled advertising in 2023 over concerns about hate speech on the platform. Musk, who purchased X when it was Twitter in 2022 to promote free speech, faced significant backlash from advertisers as the platform saw increased scrutiny over its content moderation policies.

Paxton’s investigation adds momentum to legal challenges against WFA and GARM, which are already facing scrutiny from Congress. The House Judiciary Committee previously found evidence suggesting GARM organized boycotts and used indirect tactics to target disfavored platforms and content creators.

X CEO Linda Yaccarino has pointed to the committee’s findings as evidence of GARM’s alleged collusion, saying its actions “demonetized and limited choices for consumers.”

As Paxton’s office reviews WFA’s activities, the investigation underscores growing concerns about the influence of international advertising groups on free speech and market competition. The outcome could have far-reaching consequences for the advertising industry and its role in shaping online discourse.

It’s still a major problem

— Elon Musk (@elonmusk) November 21, 2024

Musk has continued to call attention to what he describes as a systemic problem.

“It’s still a major problem,” he posted on X in response to Paxton’s announcement.