March 7, 2021

FTC and US states sue Facebook for alleged ‘illegal monopolization’ and anticompetitive conduct

(BigStock Photo)

The Federal Trade Commission and 48 states sued Facebook in a pair of landmark lawsuits Wednesday, marking the latest antitrust battle between government regulators and tech giants.

The FTC accuses Facebook of “illegal monopolization” and is aiming to potentially force the company to divest Instagram and WhatsApp.

“Personal social networking is central to the lives of millions of Americans,” Ian Conner, director of the FTC’s Bureau of Competition, said in a statement. “Facebook’s actions to entrench and maintain its monopoly deny consumers the benefits of competition. Our aim is to roll back Facebook’s anticompetitive conduct and restore competition so that innovation and free competition can thrive. ”

A separate lawsuit led by New York Attorney General Letitia James that includes Washington state also alleges that Facebook illegally stifles competition “to protect its monopoly power.” The lawsuits are separate but both the states and the FTC are collaborating.

Here’s a response from Facebook:

In October, the US Justice Department filed an antitrust complaint against Google, alleging that Google uses its dominant position to its unfair advantage as a “monopoly gatekeeper for the internet.” It seeks “structural relief,” or a breakup of the company, among other remedies to prevent Google from engaging in what the government deems is anticompetitive behavior.

The US House Judiciary antitrust subcommittee filed a report in October on competition in digital markets, detailing the ways in which Apple, Facebook, Google and Amazon capitalize on and allegedly abuse their market power to benefit themselves. The report proposed a common set of remedies, including a higher bar for acquisitions, and keeping companies from participating in marketplaces they operate.

The subcommittee report followed interviews in July with Amazon’s Jeff Bezos, Apple’s Tim Cook, Google’s Sundar Pichai, and Facebook’s Mark Zuckerberg during a wide-ranging virtual hearing on the power of Big Tech.

Seattle-based Amazon, which has yet to face formal US antitrust charges, slammed the House report as fundamentally flawed, saying it was based upon “fringe notions” about antitrust law and policy.