US Federal Trade Commission Files New Complaint Against Facebook | Social Media News

The Facebook case, first filed in December, presents a first test for U.S. Federal Trade Commission Chair Lina Khan, who was named to head the agency in June by President Joe Biden.

Through Bloomberg

On Thursday, U.S. antitrust officials refiled their lawsuit against Facebook Inc., seeking to salvage the landmark case that a judge dismissed in June.

The Federal Trade Commission filed the new lawsuit in federal court in Washington, alleging that Facebook violated antitrust laws by buying Instagram and WhatsApp in order to eliminate them as competitors.

Facebook shares reversed an earlier gain, slipping less than 1% to $355.28 as of 11:34 a.m. New York. The stock is up about 30% this year.

The agency is trying to revive the case after U.S. District Judge James Boasberg dismissed it in June, saying the agency had failed to provide enough details to back up its claim that Facebook has a market monopoly. social media. Boasberg had given the FTC 30 days to correct the error and refile, and the commission was granted an extension until August 19.

The Facebook case, first filed in December, presents a first test for FTC Chairwoman Lina Khan, who was named to head the agency in June by President Joe Biden. Khan is a leading advocate for a stronger antitrust stance against the companies and is already taking steps to bolster the agency’s authority.

Facebook is seeking to bar Khan from participating in the case, arguing that his academic writings on the company and his work on the House antitrust panel, which investigated Facebook and other tech platforms, showed that she was biased.

The lawsuit is part of a broad effort by lawmakers and competition officials to limit the power of America’s biggest tech companies. Besides the Facebook case, the Justice Department and state attorneys general across the country have several lawsuits pending against Google, while Democrats and Republicans on Capitol Hill are advancing a series of bills that would impose new restrictions on how companies do business.

Supporters of the Facebook lawsuit said Boasberg’s decision illustrates the legal hurdles the government faces in pursuing monopoly lawsuits. Proponents of reform say court rulings over decades have effectively allowed dominant companies to engage in anti-competitive tactics and that Congress must give new authority to authorities.

Boasberg didn’t just dismiss the FTC’s case. He also dismissed a parallel state attorneys general case led by New York, without giving them a chance to try again. The judge said the states waited too long to challenge Facebook’s acquisitions. Facebook bought Instagram in 2012 and WhatsApp in 2014. Legal doctrine that applied to states does not apply to the FTC.

Boasberg also narrowed the FTC’s case. In addition to trying to untie the two deals, the FTC said Facebook tried to thwart competition by only allowing third-party apps to connect to its platform on the condition that they don’t compete with Facebook and connect. not to other social networks.

The FTC argued that the policy discouraged apps from offering features that could compete with Facebook and prevented promising apps from becoming competitors that could threaten Facebook’s monopoly.

Boasberg dismissed this part of the FTC case. The judge wrote that under existing antitrust law established by the courts, companies are under no obligation to do business with other companies and can “refuse to deal” even to prevent a rival from competing .

“A monopolist has no obligation to deal with its competitors, and a refusal to do so is generally legal,” Boasberg wrote. “The FTC therefore cannot go anywhere by reframing Facebook’s adoption of a policy of refusing to deal with all competitors as the execution of an illegal plan to maintain monopoly.”