Instead, it appears that X decided to sue Twitch after discovering that Twitch was among advertisers who directly referenced the WFA’s brand safety guidelines in its own community guidelines and terms of service. X likely saw this as evidence that Twitch was allegedly conspiring with the WFA to restrict then-Twitter’s ad revenue, since X alleged that Twitch reduced ad purchases to “only a de minimis amount outside the United States, after November 2022,” X’s complaint said.
“The Advertiser Defendants and other GARM-member advertisers acted in parallel to discontinue their purchases of advertising from Twitter, in a marked departure from their prior pattern of purchases,” X’s complaint said.
Now, it seems that X has agreed to drop Twitch from the suit, perhaps partly because the complaint X had about Twitch adhering to WFA brand safety standards is defused since the WFA disbanded the ad industry arm that set those standards.
Unilever struck a similar deal to wriggle out of the litigation, Reuters noted, and remained similarly quiet on the terms, only saying that the brand remained “committed to meeting our responsibility standards to ensure the safety and performance of our brands on the platform.” But other advertisers, including Colgate, CVS, LEGO, Mars, Pinterest, Shell, and Tyson Foods, so far have not.
For Twitch, its deal seems to clearly take a target off its back at a time when some advertisers are reportedly returning to X to stay out of Musk’s crosshairs. Getting out now could spare substantial costs as the lawsuit drags on, even though X CEO Linda Yaccarino declared the ad boycott was over in January. X is still $12 billion in debt, X claimed, after Musk’s xAI bought X last month. External data in January seemed to suggest many big brands were still hesitant to return to the platform, despite Musk’s apparent legal strong-arming and political influence in the Trump administration.
Ars could not immediately reach Twitch or X for comment. But the court docket showed that Twitch was up against a deadline to respond to the lawsuit by mid-May, which likely increased pressure to reach an agreement before Twitch was forced to invest in raising a defense.