The FTC, supported by Attorney Generals of 48 states, takes unprecedented action against Facebook.
Two similar lawsuits: On 9 December 2020, the Federal Trade Commission (FTC) and 48 state Attorney Generals (AGs), led by the AG of New York, filed two separate lawsuits against Facebook. Both allege that Facebook engaged in predatory acquisitions of potential competitors – having used its dominance and monopoly power “to crush smaller rivals and snuff out competition”. The lawsuits request the divestiture of assets such as WhatsApp and Instagram, and an obligation for Facebook to seek prior approval for future acquisitions, the intention being to roll back Facebook’s anticompetitive conduct and restore competition so that innovation and free competition can thrive.
An unprecedented move from antitrust authorities: It is the first time that antitrust authorities have called for the break-up of Big Tech. The lawsuits would result in the undoing of mergers that were authorized in 2011 and 2014, and which would be incredibly challenging to undo.
Facebook on the defensive: In a statement, Facebook called the action ‘revisionist history’, noting that the two acquisitions were approved by antitrust authorities which now want a ‘do-over’. The company also pointed at the uncertainty that reversing a long-settled merger would create, putting companies off from making significant investments.
