Judge Throws Out State and Federal Cases Against Facebook

WASHINGTON — In a stunning setback to regulators’ efforts to break up Facebook, a federal judge on Monday threw out antitrust lawsuits brought against the company by the Federal Trade Commission and more than 40 states.

The judge, James E. Boasberg for the U.S. District Court for the District of Columbia, said that the case from the states needed to be dismissed because too much time had elapsed since the alleged offenses took place. The states, led by Letitia James, the New York attorney general, accused Facebook in December of buying up nascent competitors like Instagram and WhatsApp — deals made in 2012 and 2014 — to cement its monopoly over social networking.

In a separate, 53-page opinion, he said the complaint by the Federal Trade Commission, also filed in December, failed to provide enough facts to back its claims that Facebook had a monopoly over personal social networking.

The judge said that the F.T.C. had 30 days to refile its complaint.

“This really stings,” said William E. Kovacich, a former chairman of the agency. “This is a reminder to those who have wanted a dramatic sweeping litigation campaign to take on Big Tech that there’s nothing easy about it, because the courts have a different view of the antitrust system.”

Representatives for the F.T.C., the New York attorney general and Facebook did not immediately have comments.

The news pushed Facebook’s stock past $1 trillion in market capitalization, a first for the social network and one of only half a dozen companies to reach such a valuation. Shares of Facebook were trading at $355 at around 3:30 on Monday, up 4 percent on the news.

The decision was a disappointment for the growing cohort of activists who have pushed regulators to move to break up the biggest tech companies.

Senator Josh Hawley, a Republican of Missouri and a critic of Big Tech, said in a tweet that the court had acknowledged Facebook’s “massive market power but essentially shrugged its shoulders.”

Sarah Miller, the executive director of the antitrust think tank the American Economic Liberties Project, said she hoped the states would appeal the dismissal and the F.T.C. would file its case again. But she said that the judge’s ruling underscored the need for Congress to update the laws that police market concentration.

“The courts are going to need, ideally, some congressional guidance here, given that they have some outsized role in determining the outcomes of antitrust cases,” she said. “Sometimes losses can be good because it can just reinforce that necessity, and we’re hoping that this will serve to do that.”

This is a developing story. Check back for updates.

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