A U.S. judge in Washington has ruled that Meta Platforms, the parent company of Facebook, must go to trial in a Federal Trade Commission (FTC) lawsuit that seeks to break up the company. The lawsuit accuses Meta of acquiring Instagram and WhatsApp with the intent to stifle competition in the social media landscape.
Judge James Boasberg has largely rejected Meta’s request to dismiss the case, initially filed in 2020 during the Trump administration. The FTC alleges that Meta engaged in illegal practices to uphold its monopoly in the social networking market.
The FTC’s claims claim that Meta, then operating as Facebook, overvalued its acquisitions of Instagram in 2012 and WhatsApp in 2014 as a means to neutralize potential competitive threats rather than compete effectively in the mobile ecosystem.
While Judge Boasberg allowed the core accusation regarding these acquisitions to proceed, he dismissed the FTC’s argument suggesting that Facebook reinforced its market dominance by limiting third-party app developers’ access to its platform unless they agreed not to compete directly with Facebook’s main services.
A spokesperson for Meta expressed confidence in the upcoming trial, stating that they believe the evidence will demonstrate that acquiring Instagram and WhatsApp ultimately benefited competition and consumers alike.
FTC spokesperson Douglas Farrar noted that the case, which has been refined under the Biden administration, symbolizes a bipartisan initiative aimed at limiting Meta’s monopolistic power and restoring competition to foster innovation within the social media sector.
As part of the trial preparations, Judge Boasberg has determined that Meta will not be permitted to argue that its acquisition of WhatsApp promoted competition by enhancing its position against rivals such as Apple and Google.
The judge indicated that a detailed order would be made public later in the day, after both the FTC and Meta have had an opportunity to redact any confidential commercial information.
No trial date has been established yet for the proceedings.
Meta had requested the dismissal of the entire lawsuit, arguing that it was based on an overly narrow definition of the social media market and failed to consider competition from platforms like ByteDance’s TikTok, Google’s YouTube, X (formerly Twitter), and Microsoft’s LinkedIn.
This case is one of several high-profile lawsuits initiated by antitrust authorities at both the FTC and the U.S. Department of Justice targeting major tech companies. Other firms, including Amazon.com Inc and Apple, are also facing lawsuits, while Alphabet’s Google confronts two legal challenges, one of which recently concluded with a ruling that the company unlawfully hindered competition among online search engines.
© Thomson Reuters 2024
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