US FTC and states file antitrust lawsuits against Facebook | News | DW | 09.12.2020
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US FTC and states file antitrust lawsuits against Facebook

The New York Attorney General is leading a coalition of 48 states filing a lawsuit against the social media giant. It comes as the Federal Trade Commission seeks the sell-off of Instagram and Facebook.

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The lawsuits accuse Facebook of using its dominant market position to suppress or buy out the competition

The US Federal Trade Commission (FTC) and 48 states filed two antitrust lawsuits against Facebook on Wednesday.

New York Attorney General Letitia James said she was leading a coalition of 48 states filing one lawsuit that accused Facebook of using "vast amounts of money" to acquire competition and quash rivals.

The filing asked the court to halt Facebook's anti-competitive practices.

"For years, Facebook has used its monopoly power as a social networking website to stifle competition and innovation and to sell alarming amounts of user data to make money, all at the expense of the many people who use its platform," North Carolina Attorney General Josh Stein said in a statement.

The FTC separately filed a lawsuit seeking to force Facebook to sell off its subsidiaries Instagram and WhatsApp.

Facebook purchased picture-focused social media giant Instagram in April 2012 and the instant messaging service WhatsApp in 2014. These are arguably the company's two most famous acquisitions, but in total Facebook has merged with or acquired more than 80 rival enterprises.

"Facebook's actions to entrench and maintain its monopoly deny consumers the benefits of competition," said Ian Conner, director of the FTC's Bureau of Competition. 

"Our aim is to roll back Facebook's anti-competitive conduct and restore competition so that innovation and free competition can thrive."

Attorney General said the state coalition worked collaboratively with the FTC, but conducted their investigations separately.

'Government wants a do-over'

Facebook, headquartered in Menlo Park, California, recorded 2019 revenue figures in excess of $70 billion (€58 billion), and net income of almost $18.5 billion.

Facebook said in a post on Twitter that it was reviewing the complaint, but said: "Years after the FTC cleared our acquisitions, the government now wants a do-over with no regard for the impact that precedent would have on the broader business community or the people who choose our products every day."

The FTC levied its largest fine on a tech company in 2019, costing Facebook $5 billion for privacy violations. It had no no visible impact on Facebook's business.

Earlier this year, the FTC announced it would review acquisitions made by five major tech firms over the past decade.

Scrutiny in Europe

The social media giant has also come under scrutiny by EU regulators over the way it collects and monetizes its data. 

In October, the European Parliament overwhelmingly backed plans to develop the "Digital Services Act," legislation that seeks to significantly rein in Facebook's power in the EU.

However, Facebook said that stringent regulation would force the company away from Europe, potentially costing jobs, as well as meaning a lack of access to its site for users in the EU.

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aw, jsi/msh (Reuters, AP)

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