In a rare show of a united front, 48 AGs from 46 states within the United States, along with the federal trade commission (FTC) are suing Facebook for “unfairly” crushing competition. The lawsuits, which were pretty much anticipated, call for dismantling of the current corporate entity that Facebook is along with several other restrictions. The FTC lawsuit, filed under Trump administration, could very well be the last big action that Trump takes during his presidency and one which could gain support from either side of the aisle.
These separate antitrust lawsuits, which Facebook will now have to deal with individually, were announced by New York attorney general Letitia James and FTC. The lawsuits are particularly focused towards two of the most notable and controversial acquisitions in the internet industry – Facebook’s $1Bn buyout of Instagram and its massive $19Bn acquisition of WhatsApp.
With those two acquisitions in place, Facebook now has a clear monopoly over global social media space, owning three of the most used social media platforms. The lawsuits have specifically targeted in these points.
”For nearly a decade, Facebook has used its dominance and monopoly to crush smaller rivals and snuff out competition”, said James. “Facebook used vast amounts of money to acquire potential rivals before they could threaten the company’s dominance”, she added. This is something that came up during the recent Congressional hearing that Facebook CEO Mark Zuckerberg was a part of.
“Almost every state in this nation has joined this bipartisan lawsuit because Facebook’s efforts to dominate the market were as illegal as they were harmful,” James said. “Today’s suit should send a clear message to Facebook and every other company that any efforts to stifle competition, reduce innovation, or cut privacy protections will be met with the full force of our offices.”
FTC, in its own lawsuit filed in Washington, said, “The FTC is seeking a permanent injunction in federal court that could among other things: require divestitures of assets, including Instagram and WhatsApp; prohibit Facebook from imposing anticompetitive conditions on software developers; and require Facebook to seek prior notice and approval for future acquisitions and mergers”.
Facebook, in a Tweet, said it is looking into the lawsuits, but disparaged them, saying, “The government now wants a do-over with no regard for the impact that precedent would have on the broader business community.”
