New York Attorney General Letitia James led a group of 48 attorneys general from across the U.S. in filing an antitrust lawsuit against Facebook Inc. on Dec. 9, alleging in the court filing that the company illegally stifled competition to protect its monopoly power.
Separately, the U.S. Federal Trade Commission filed its own antitrust lawsuit against Facebook for engaging in allegedly anti-competitive business practices.
Both lawsuits call out practices that the social media company allegedly took to hamper potential competitors and consolidate its monopoly on social media advertising. In particular, each takes issue with Facebook's acquisitions of photo-blog Instagram LLC and mobile messaging app WhatsApp Inc. in 2012 and 2014, respectively, as examples of Facebook's strategic decision to acquire rather than compete directly with new and emerging social media platforms.
Facebook responded to the complaints in a tweet, saying the lawsuits amounted to an attempted "do-over" of acquisitions that were previously cleared by regulators.
"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," Facebook said in its tweet. The company said it was reviewing the complaints and would have more to say on the matter soon.
The two lawsuits ask a judge to consider a wide swath of potential remedies, such as requiring the divestiture of Facebook's assets, including Instagram and WhatsApp and requiring Facebook to gain approval for future mergers and acquisitions. The FTC also asks for a prohibition to stop Facebook from imposing anti-competitive restrictions on software developers.
In addition to questioning Facebook's acquisitions of Instagram and WhatsApp, the lawsuits allege that Facebook employed tactics designed to hamper third-party developers. The FTC's complaint, for instance, alleges that Facebook has restricted third-party developers' access to Facebook's key connectivity features, such as application programming interfaces, or APIs, that enable developers' mobile apps to interact with Facebook.
"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, in a statement. "Our aim is to roll back Facebook's anticompetitive conduct and restore competition so that innovation and free competition can thrive."
When asked why the attorneys general filed a separate suit, James said "it's important to understand that we are independent government enforcers of the law."
James announced the multistate probe in September 2019. At the time, she said the group would assess whether Facebook's actions "endangered consumer data, reduced the quality of consumers' choices, or increased the price of advertising." Facebook disclosed the FTC investigation in July 2019.
The FTC also cracked down on Facebook for privacy violations in 2019 by levying a fine for violating a 2012 order with the agency related to the company's user data practices.
The fine was the largest ever imposed by the agency against a company for consumer privacy violations.