"We tried peace for 2 years, now it is war," Elon Musk wrote on X this week.

He was referring to the ongoing battle he's had with advertisers on the platform he purchased in 2022, and which was formerly called Twitter.

Linda Yaccarino, X's CEO, echoed the sentiment in an open letter and a video message she posted. "The illegal behavior of these organizations and their executives cost X billions of dollars... To those who broke the law, we say enough is enough. We are compelled to seek justice for the harm that has been done by these and potentially additional defendants, depending what the legal process reveals," her letter states, notes Ars Technica.

While X is no longer a publicly traded company, a report by Emarketer estimated that the social media platform lost 52 percent of its ad revenue in 2023, cites the New York Times. Much of that decline is a result of what firms see as a rise of right-wing hate speech and conspiracy theories on X, leading them to pull their ads.

But can Musk and Yaccarino stop the damage done?

“Unilever, and Unilever alone, controls our advertising spending…No platform has a right to our advertising dollar,” Herrish Patel, president of Unilever USA, told a Congressional hearing earlier this year, reports the Associated Press.

However, according to Reuters, X's lawsuit claims that it has become a "less effective competitor” in digital ad sales as a result of what it classifies as an illegal boycott by advertising groups like the Responsible Media Initiative launched in 2019.

X would need to prove that every advertiser explicitly agreed to boycott the platform, and "Proving this requirement is no small hurdle,"Christine Bartholomew of the University of Buffalo law school added.

For Ruben Schreurs, chief strategy officer at marketing consulting firm Ebiquity, the lawsuit strategy is inherently flawed. As he told the New York Times: "To the extent that Elon hadn’t already burned all bridges and ties with the entire advertising community, I don’t see how this will get any advertisers to come back to X. …It’s a last-ditch effort to force brands who don’t want to be in the cross hairs of this kind of legal action to return to the platform.”

A String Of Lawsuits

Elon Musk has seen a string of lawsuits dismissed or dropped.

In March, a federal judge dismissed his suit against the Center for Countering Digital Hate (CCDH), which Musk claimed scared advertisers away by publishing a report on the rise of hate groups on X. A judge tossed a similar suit Musk brought against Bright Data for helping CCDH and others scrape data off X.

In June, Musk, a co-founder of OpenAI, dropped his lawsuit against Sam Altman and OpenAI for an alleged breach of contract.

Verdict

While Musk and Yaccarino are trying a final Hail Mary to win advertisers back, suing them may prove to push advertisers away further. However, it may also create an opening for some advertisers to return claiming that they felt pressured by other firms in their advertising initiative to boycott X.