The federal government and 48 attorneys general filed twin lawsuits against Facebook on Wednesday seeking to potentially break up the tech giant and restrict future business practices.
The Federal Trade Commission and attorneys general from 46 states, the District of Columbia, and Guam are challenging Facebook’s acquisition of Instagram and WhatsApp in 2012 and 2014, respectively. The lawsuits are also seeking to force Facebook to notify the federal government of any future acquisitions worth $10 million or more.
“Personal social networking is central to the lives of millions of Americans,” FTC Bureau of Competition Director Ian Conner said in a statement. “Facebook’s actions to entrench and maintain its monopoly deny consumers the benefits of competition. Our aim is to roll back Facebook’s anticompetitive conduct and restore competition so that innovation and free competition can thrive.”
The potential forced offloading of Instagram and WhatsApp represents an “existential” threat to the social media giant, Facebook CEO Mark Zuckerberg has said. Facebook struck back at regulators, accusing them of attempting to retroactively block mergers they had approved years earlier.
“The most important fact in this case, which the commission does not mention in its 53-page complaint, is that it cleared these acquisitions years ago,” Facebook general counsel Jennifer Newstead told The New York Times in a statement. “The government now wants a do-over, sending a chilling warning to American business that no sale is ever final.”
The lawsuits claim that Facebook’s purchase of Instagram for $1 billion in April 2012 and WhatsApp for $19 billion in February 2014 represented aggressive and monopolistic behavior, deciding to take over budding competitors rather than innovating and competing. The lawsuits further allege that Facebook as engaged in anticompetitive practices, using access to its interface to either stunt the growth of competitors or ensure that other software developers refrain from competing with Facebook.
Facebook’s acquisitions have been key to its explosive growth over the past decade. As the Times reports:
Since those deals, Instagram and WhatsApp have skyrocketed in popularity, giving Facebook control over three of the world’s most popular social media and messaging apps. The applications have helped catapult Facebook from a company started in a college dorm room 16 years ago to an internet powerhouse valued at more than $800 billion.
The move to break up Facebook comes several months after the Department of Justice filed an antitrust lawsuit against Google, accusing the tech giant of anticompetitive and monopolistic behavior.
The Daily Wire reported in October:
The lawsuit will allege that the tech giant has engaged in anticompetitive practices to protect its search and search-advertising businesses, sources identified only as senior DOJ officials told The Wall Street Journal.
Google has frozen out competitors through contracts between the tech giant and browsers, carriers, and mobile phone manufacturers that give Google such prime standing as the default search engine across a variety of platforms as to bar any competitors from beginning to compete with the tech giant. Google’s search queries make up roughly 80% of all those in the U.S.