The Federal Trade Commission has filed an amended antitrust lawsuit against Facebook alleging social media monopolization nearly two months after an initial complaint against the company was tossed.
The FTC voted 3-2 to move forward with the amended lawsuit, which claims that the social media giant sought to cut out its competition by buying up social media rivals, such as Instagram, which it acquired for $1 billion in 2012, and WhatsApp, which it purchased for $19 billion in 2014. It also claims Facebook anti-competitively denied third-party apps access to its platform.
The Thursday complaint, which is much longer than the original, expanded upon its charges against Facebook by pointing out the volume of users on Facebook’s platform and the amount of time users spend on that platform compared to its rivals.
“After failing to compete with new innovators, Facebook illegally bought or buried them when their popularity became an existential threat,” said Holly Vedova, acting director of the FTC’s Competition Bureau, according to CNN. “This conduct is no less anti-competitive than if Facebook had bribed emerging app competitors not to compete.”
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In late June, a Washington, D.C., federal court dismissed the FTC’s original antitrust lawsuit, arguing that it was too vague in its complaint and didn’t provide enough evidence to support its allegations that Facebook abused its power by monopolizing the social media market.
“The FTC’s Complaint says almost nothing concrete on the key question of how much power Facebook actually had, and still has, in a properly defined antitrust product market,” U.S. District Judge James Boasberg wrote, handing the win to Facebook.
Boasberg added that it appeared as though the FTC “expects the Court to simply nod to the conventional wisdom that Facebook is a monopolist.”
In re-upping the lawsuit, the FTC also denied Facebook’s petition to have newly appointed Chairwoman Lina Khan recused from the case. Khan, an antitrust crusader, was appointed by President Joe Biden in June to lead the commission.
Khan, 32, rose in prominence in the tech policy community while at Yale Law School with an article titled, “Amazon’s Antitrust Paradox.” Facebook had asserted that, given Khan’s past statements, she had already made up her mind that the company was guilty of monopolization.
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Facebook responded to Thursday’s amended complaint in a statement provided to the Washington Examiner by saying it was “unfortunate” that the FTC decided to continue its “meritless lawsuit.”
“There was no valid claim that Facebook was a monopolist — and that has not changed,” a spokesperson said. “Our acquisitions of Instagram and WhatsApp were reviewed and cleared many years ago, and our platform policies were lawful. The FTC’s claims are an effort to rewrite antitrust laws and upend settled expectations of merger review, declaring to the business community that no sale is ever final.”
