Forceful sale of Instagram and WhatsApp by Federal Trade Commission
A federal judge has ruled that the US competition watchdog can proceed with a breakup lawsuit against Facebook’s owner.
For the second time, the court had been requested by Mark Zuckerberg’s Meta, the parent of Facebook, Instagram and WhatsApp, to dismiss an antitrust complaint brought by the Federal Trade Commission (FTC). The FTC’s revised lawsuit should, however, be allowed to proceed, Judge James Boasberg said on Tuesday.
Boasberg, of the US District Court for the District of Columbia, wrote:
“Ultimately, whether the FTC will be able to prove its case and prevail at summary judgment and trial is anyone’s guess. The court declines to engage in such speculation and simply concludes that at this motion-to-dismiss stage, where the FTC’s allegations are treated as true, the agency has stated a plausible claim for relief.”
In one of the biggest challenges the government has brought against a tech company in decades, Meta will be forced to sell its photo-sharing app Instagram and its messaging service WhatsApp by the FTC, under the new chair, Lina Khan. Meta is accused of pursuing a “course of anti-competitive conduct” by its lawsuit.
During the Trump administration, the FTC originally sued Facebook and in June last year its complaint was rejected by the court. To add more detail on the accusation that the social media company had crushed or bought rivals, the agency filed an amended complaint in August. On a daily basis, Meta’s platforms are used by 2.8 billion people around the world.
This time around the FTC had been “far more robust and detailed” in presenting its case, Boasberg said. He wrote:
“The agency has also explained that Facebook 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, saying the policies had been abandoned in 2018, the judge, in his ruling, said that allegations could not be pressed that Facebook blocked competing apps from accessing its platform by the FTC as a way to maintain its dominance.
Confidently, Meta said it would win in court.
A spokesperson said:
“Today’s decision narrows the scope of the FTC’s case by rejecting claims about our platform policies. It also acknowledges that the agency faces a ‘tall task’ proving its case regarding two acquisitions it cleared years ago.”
On Tuesday, shares of Meta closed up1.9% at $334.37 and valuing the company at $930bn (£683bn).