Eliza Labs and founder Shaw Walters filed a federal antitrust lawsuit towards social media platform X on Aug. 27.
Based on the lawsuit, the plaintiffs are alleging that the social media platform fraudulently extracted technical details about their AI brokers earlier than deplatforming them and launching competing merchandise.
The criticism seeks damages exceeding $75,000 and instant restoration of the account.
In an Aug. 28 assertion, Walters described the lawsuit as a final resort after months of failed negotiations.
He stated:
“X and xAI notice this on some stage – they simply filed a lawsuit alleging that Apple and OpenAI are doing the identical anticompetitive conduct to them that X is doing to us.”
Walters added that X initially invited collaboration after seeing widespread adoption of Eliza’s open-source AI agent framework.
Following conferences at X headquarters in February, the platform demanded Eliza buy a $600,000 annual enterprise license regardless of already paying over $20,000 yearly in charges.
Antitrust claims
An antitrust lawsuit challenges practices that hurt truthful competitors, comparable to monopolies and anticompetitive conduct, to guard customers and guarantee open markets.
Eliza’s criticism alleges X violated Part 2 of the Sherman Act by leveraging monopoly energy in short-form social media to suppress AI competitors.
The lawsuit particulars how X suspended Eliza’s accounts in June 2025, then demanded intensive technical documentation beneath the pretense of account reinstatement.
Walters claims that X used this info to develop almost similar AI options, together with 3D avatars, voice integration, and phone capabilities, which had been launched by xAI’s merchandise.
He added that X requested detailed explanations of Eliza’s framework structure, endpoint performance, and implementation specifics whereas creating competing merchandise.
Treatments embrace platform restoration
The lawsuit seeks a number of types of reduction, together with a declaratory judgment that X lacks Part 230 immunity for anticompetitive deplatforming, injunctions stopping future exclusionary conduct, and account restoration with full platform entry.
Financial treatments embrace disgorgement of X’s unjust enrichment from copying Eliza’s know-how, compensation for fraudulent misrepresentation, and unfair competitors damages, in addition to treble damages beneath the Sherman Act provisions.
The plaintiffs additionally request punitive damages and attorneys’ charges. The lawsuit comes days after Elon Musk’s xAI sued Apple and OpenAI on Aug. 25.
Musk’s lawsuit alleged that the businesses conspired to suppress AI competitors by Apple’s unique ChatGPT integration and App Retailer favoritism. The lawsuit claims Apple’s partnership with OpenAI makes it “unattainable for any AI firm apart from OpenAI to succeed in #1 within the App Retailer.”
The parallel litigation highlights escalating authorized battles over AI market management, with Musk pursuing antitrust claims whereas dealing with very related allegations from Eliza Labs.
