The trade group World Federation of Advertisers is
urging a federal judge to throw out Elon Musk's lawsuit over an alleged ad boycott, arguing that Texas courts lack jurisdiction to hear the dispute.
In papers filed Wednesday with U.S.
District Court Judge Jane Boyle in the Northern District of Texas, the Belgian-based industry organization says it has never maintained an office or business operations in Texas, held a conference in
the state, employed anyone in the state, or engaged in any other activity that would establish “relevant contacts” with Texas.
“WFA’s business activities have never
occurred, and do not currently occur, in Texas, let alone the Northern District of Texas,” the organization argues.
The group's papers come in response to a lawsuit brought last August by Musk's X Corp., which alleged that advertiser group and
its now defunct brand safety initiative, Global Alliance for Responsible Media (GARM), sparked a “massive advertiser boycott” that cost the company billions in ad revenue.
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The ad
organization argues that Musk's complaint lacks any the kind of non-conclusory allegations that would demonstrate jurisdiction.
“Plaintiff fails to allege any facts demonstrating that
WFA engages in any continuous business activities within the district,” the group contends.
The complaint alleges that some members of the organization are based in Texas, but the WFA
argues that a professional association such as itself doesn't do business in a district merely because some members reside in that district.
Musk sued shortly after the Republican-led House
Judiciary Committee issued a report accusing GARM of coordinating action by corporations, ad agencies and other industry groups in order to “demonetize platforms, podcasts,
news outlets, and other content deemed disfavored by GARM and its members.”
The House staff report alleged that GARM colluded with others to cut ad revenue to X after Musk purchased it
in October 2022.
The World Federation of Advertisers shuttered GARM
in August, days after the suit was filed.
The World Federation of Advertisers said last August that GARM's brand-safety standards were voluntary, and that members were free to accept or reject
those standards.
CEO Stephan Loerke said in a declaration submitted to the court Wednesday that GARM “was created to bring clarity and transparency to definitions and understandings in
advertising and brand safety in the context of social media.”
He added that no members of either the World Federation of Advertisers or GARM were required to use its brand-safety
framework, and that some GARM members “either did not substantively change their brand-safety processes or used a modified version of the framework at their discretion.”
Other
defendants in the case include Ørsted, Mars, CVS, Abbott, Colgate, Lego (parent company Lego A/S and subsidiary LEGO Brand Retail), Nestle, Pinterest, Shell (holding company Shell plc and
subsidiaries Shell USA and Shell Brands International), and Tyson.
Shell plc, Shell Brands International and Lego A/S on Wednesday afternoon separately asked Boyle to dismiss the
complaints against them. Those companies all argued that they didn't have the kinds of ties to Texas that would subject them to jurisdiction in the state.
The other companies named in the
lawsuit are expected to file separate arguments.