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  • Writer's picturePeter DiSilvio

Status of antitrust lawsuit against Facebook

The Federal Trade Commissions lawsuit against Meta, the parent company of Facebook, alleging that the organization enjoys an illegal monopoly continues to work its way through the courts. The case has been ongoing since 2020 and, despite Meta's best efforts, seems to be continuing for months and years to come.

The case began in December of 2020 when the Federal Trade Commission brought their action against Facebook "alleging that the company is illegally maintaining its personal social networking monopoly through a years-long course of anticompetitive conduct. Following a lengthy investigation in cooperation with a coalition of attorneys general of 46 states, the District of Columbia, and Guam, the complaint alleges that Facebook has engaged in a systematic strategy—including its 2012 acquisition of up-and-coming rival Instagram, its 2014 acquisition of the mobile messaging app WhatsApp, and the imposition of anticompetitive conditions on software developers—to eliminate threats to its monopoly. This course of conduct harms competition, leaves consumers with few choices for personal social networking, and deprives advertisers of the benefits of competition." [1]

The FTC amended their complaint in August of 2021 to include allegations that "after repeated failed attempts to develop innovative mobile features for its network, Facebook instead resorted to an illegal buy-or-bury scheme to maintain its dominance. It unlawfully acquired innovative competitors with popular mobile features that succeeded where Facebook’s own offerings fell flat or fell apart. And to further moat its monopoly, Facebook lured app developers to the platform, surveilled them for signs of success, and then buried them when they became competitive threats. Lacking serious competition, Facebook has been able to hone a surveillance-based advertising model and impose ever-increasing burdens on its users." [2]

In January Facebook sought to end the lawsuit but a Federal Judge rules that the case could proceed. Judge James E. Boasberg found that federal regulators had offered enough proof to argue that Facebook's acquisition strategy, the buy or bury model", met the standards for an illegal monopoly under the law [3]. It should be noted that this was not a finding that Facebook had actually engaged in illegal conduct but, rather, that the Federal government has offered enough proof to show that they can make the argument.

"Traditionally, winning an antitrust cases has turned on proving that a company's dominance hinders competition and raises prices for consumers, or limits consumers' choices. This standard has always been difficult to apply to Big Tech companies, since so many of its products and services are free. But the FTC, under the leadership of fierce tech critic Lina Khan, has worked to broaden the agency's mandate, focusing instead on how companies wield power to distort markets and hurt the overall economy." [4]

The case is expected to proceed for months if not years with no clear end in sight.



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