Fresh development in Meta’s battle against US regulator, seeking to force Facebook to divest itself of WhatsApp and Instragram
Meta Platforms on Tuesday asked a US court to order the US Federal Trade Commission (FTC) to hand over its old documents about two of its most significant purchases.
But the FTC has given itself a second chance to go after Meta over its alleged anti-competitive conduct by buying up rivals and stifling competition. If it loses, Meta faces a risk of having to divest itself of Instagram and WhatsApp.
That second chance came back in December 2020 in the last days of the Donald Trump presidency, when Meta’s Facebook was hit with two separate antitrust lawsuits over the WhatsApp, Instagram purchases.
One lawsuit came from the FTC, and a second lawsuit came from a coalition of attorneys general from 48 states and territories.
The FTC alleged Meta acted illegally to maintain its social network monopoly.
At the time Facebook claimed the lawsuits were nothing other than ‘revisionist history’, and in March 2021 Meta asked US District Judge James Boasberg in the District of Columbia to dismiss the antitrust lawsuits.
It argued the government had failed to show that Facebook had a monopoly in a clearly defined market, or that it had hurt consumers.
Facebook also responded separately to the lawsuit brought by dozens of states and territories.
The social networking giant argued that the US state lawsuit should be dismissed because the states failed to show that they were harmed by Facebook and because they waited more than four years.
Then in June 2021 Judge Boasberg dismissed the initial FTC complaint, when he ruled that the FTC had failed to define a plausible market that Facebook monopolised, and suggested too loose of a percentage of market share it owned.
He said the FTC lacked authority under its chosen statute to bring charges against Facebook for how it implemented an old policy preventing rivals from accessing its platform seven years ago.
Judge Boasberg said that in order for the FTC to receive an injunction under that statute it must be clear that a violation is in progress or about to occur.
However he gave the FTC the chance to amend its complaint.
At that time Judge Boasberg also dismissed the similar lawsuit from US states, without granting a chance for reconsideration.
In August 2021 the FTC doubled down and amended its original complaint that Facebook “resorted to illegal buy-or-bury scheme to crush competition after a string of failed attempts to innovate.”
The FTC in its amended complaint also alleged that Facebook “lured app developers to the platform, surveilled them for signs of success, and then buried them when they became competitive threats.”
Then in a setback for Mark Zuckerberg, Judge James Boasberg in January 2022 rejected Facebook’s motion to dismiss the amended FTC complaint.
Now Reuters has reported that Meta’s Facebook has asked a US court for eight documents created by the FTC as part of its review of the company’s purchases of Instagram and WhatsApp in 2012 and 2014 respectively, which the regulator allowed to proceed back then.
“Both the Instagram and the WhatsApp documents are almost certain to reveal that the FTC determined that each acquisition was unlikely to lessen competition or harm consumers,” Meta’s Facebook was quoted by Reuters as saying in its court filing.
Meta argued that the FTC had given the documents to the House Judiciary Committee when it probed the tech giants, that also included the likes of Amazon, Alphabet’s Google and Apple.
“Any claim of privilege was waived when the FTC chose to voluntarily share the documents with House Judiciary Committee members and staff,” Meta’s Facebook said in its filing.
The FTC did not immediately respond to a request for comment on the filing.
According to Reuters, among the documents being requested are the memos that the FTC Bureau of Competition and Bureau of Economics wrote for commissioners about whether the Instagram deal should be allowed to close.
Meta is also asking for notes made by Bureau of Competition personnel about the WhatsApp transaction.