A U.S. district court in Washington D.C. has dismissed an antitrust lawsuit against Facebook filed late last year by the Federal Trade Commission.
Judge James E. Boasberg ruled that the complaint against the social media giant was “worded too vaguely” and that more evidence was needed to prove that Facebook is running a monopoly.
“The FTC has failed to plead enough facts to plausibly establish a necessary element of all of its Section 2 claims — namely, that Facebook has monopoly power in the market for Personal Social Networking (PSN) Services,” the judge wrote.
The FTC has until July 29 to file an amended complaint, Boasberg said.
The ruling was seen as a severe blow to attempts to regulate a behemoth of the tech world. Facebook shares surged more than 4% on the promising news and surpassed $1 trillion in market value for the first time, according to CNBC.
The ruling also stated that the case filed jointly by New York Attorney General Letitia James wasn’t filed in time.
Federal regulators along with 48 states and districts sued in December to force a breakup of Facebook, accusing the company in a separate lawsuit of abusing its market power in social networking to crush smaller competitors.
The FTC specifically asked a court to force Facebook to sell off its Instagram and WhatsApp messaging services and accused Facebook of engaging in a “a systematic strategy” to eliminate its competition, including by purchasing smaller up-and-coming rivals like Instagram in 2012 and WhatsApp in 2014.
Facebook “used its monopoly power to crush smaller rivals and snuff out competition, all at the expense of everyday users,” James said at the time.
She noted that “it’s really critically important that we block this predatory acquisition of companies and that we restore confidence to the market.”
Previously, the FTC fined Facebook $5 billion in 2019 for privacy violations and instituted new oversight and restrictions on its business. The fine was the largest the agency has ever levied on a tech company, although it had no visible impact on Facebook’s business.
Facebook called the government actions “revisionist history” that punishes successful businesses and noted that the FTC cleared the Instagram and WhatsApp acquisitions years ago. “The government now wants a do-over, sending a chilling warning to American business that no sale is ever final,” Facebook general counsel Jennifer Newstead said in a statement that echoed the company’s response to a recent congressional antitrust probe.
Facebook is the world’s biggest social network with more than 2.7 billion users and a company with a market value of nearly $800 billion whose CEO Mark Zuckerberg is the world’s fifth-richest individual and the most public face of Big Tech swagger.
The landmark antitrust lawsuits, announced by the Federal Trade Commission and New York Attorney General Letitia James, marked the second major government offensive against seemingly untouchable tech behemoths.
The Justice Department sued Google in October for abusing its dominance in online search and advertising — the government’s most significant attempt to buttress competition since its historic case against Microsoft two decades ago. Amazon and Apple also have been under investigation in Congress and by federal authorities for alleged anticompetitive conduct.
Information provided by The Associated Press was used to compiled this report.
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