A federal judge ruled Tuesday that the Federal Trade Commission’s revised antitrust lawsuit against Meta Platforms, the parent company of Facebook, can move forward—a potentially significant blow to the social media empire, which sought to have the case dismissed.
In an amended complaint filed last August, the FTC provided additional data and stronger details to back up its allegations that Facebook has maintained a monopoly on social networking services for the past decade by “illegally acquiring innovative competitors and burying successful app developers.”
U.S. District Judge James Boasberg—who in June dismissed the FTC’s first antitrust complaint against Facebook, calling it “legally insufficient”—wrote in Tuesday’s ruling that the evidence in the agency’s second filing is “far more robust and detailed than before.”
While the FTC’s overall argument didn’t change much following Boasberg’s denial of the agency’s initial case, its updated lawsuit is almost twice as long and includes more statistical analysis and facts to bolster the government’s accusation 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.”
In a development described as a “major win” for anti-monopoly advocates, Boasberg on Tuesday rejected Facebook’s attempt to get the new case thrown out, allowing the legal effort to break up the tech giant to proceed.
Just in: FTC's amended antitrust complaint against Facebook can proceed, a major win for the agency after its first complaint was dismissed. pic.twitter.com/wKy03PAhrQ— Bobby Allyn (@BobbyAllyn) January 11, 2022
“Although the agency may well face a tall task down the road in proving its allegations, the Court believes that it has now cleared the pleading bar and may proceed to discovery,” Boasberg wrote, giving the FTC a green light to scrutinize Facebook’s internal records.
Sen. Elizabeth Warren (D-Mass.) applauded the judge’s decision.
“Facebook has bulldozed competition to dominate the market,” said Warren. “We need to break up Big Tech and hold Facebook accountable for any violations of antitrust law.”
“Although the agency may well face a tall task down the road in proving its allegations, the Court believes that it has now cleared the pleading bar and may proceed to discovery.”
Led by “antitrust trailblazer” Lina Khan—who took charge of the FTC just days before its first complaint against Facebook was discarded—the agency’s updated lawsuit aims to force Meta CEO Mark Zuckerberg to sell off Instagram, a former rival photo-sharing service acquired in 2012, and WhatsApp, a messaging platform purchased in 2014.
If successful, it “would be the United States’ first court-ordered breakup of a company on antitrust grounds since AT&T in the early 1980s,” according to Politico.
In his ruling, Boasberg wrote that the FTC’s second complaint against Facebook made a plausible case that the corporation “not only possesses monopoly power but that it has wilfully maintained that power through anti-competitive conduct—specifically, the acquisitions of Instagram and WhatsApp.”
However, The Guardian reported Wednesday, the judge also noted that “the FTC could not press allegations that Facebook blocked competing apps from accessing its platform as a way to maintain its dominance, saying the policies had been abandoned in 2018.”
As Common Dreams reported last year, Facebook and Amazon responded to Khan’s appointment by pressuring her to recuse herself from antitrust cases involving the tech titans, prompting a group of congressional lawmakers, including Warren and Rep. Pramila Jayapal (D-Wash.), to send a letter telling the companies’ CEOs to stop trying to “strip… Khan of her authority to enforce antitrust law.”
The FTC made clear that Khan, who voted to file the amended complaint, will not recuse herself from the lawsuit against Facebook. “As the case will be prosecuted before a federal judge, the appropriate constitutional due process protections will be provided to the company,” the agency said in August.
Facebook claimed that because Khan’s past writings on antitrust violations are critical of the company’s practices, her involvement should invalidate the case, but Boasberg rejected that argument and sided with the FTC on Tuesday.
“The Court believes that such contention misses its target,” wrote Boasberg, “as Khan was acting in a prosecutorial capacity, as opposed to in a judicial role, in connection with the vote.”
“Although Khan has undoubtedly expressed views about Facebook’s monopoly power,” the judge added, “these views do not suggest the type of ‘axe to grind’ based on personal animosity or financial conflict of interest that has disqualified prosecutors in the past.”
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