Judge Rules Meta Must Face FTC Antitrust Trial Over Instagram, WhatsApp Acquisitions

Meta Platforms, the parent company of Facebook, is set to face a high-profile antitrust trial following a ruling by a federal judge in Washington on Wednesday. This development stems from a lawsuit filed by the Federal Trade Commission (FTC), which claims that Meta’s acquisitions of Instagram and WhatsApp were strategically aimed at suppressing potential competition within the social media landscape.

Judge James Boasberg largely denied Meta’s motion to dismiss the FTC’s case, which was originally filed in 2020 during the Trump administration. The FTC alleges that Facebook, now Meta, acquired Instagram in 2012 and WhatsApp in 2014 at inflated prices to neutralize competitive threats rather than contend with them on equal footing. According to Reuters, Boasberg’s decision allows this core claim to proceed to trial, which will focus on whether Meta’s past acquisitions amounted to illegal monopolistic behavior.

However, the judge dismissed another FTC accusation that Meta strengthened its market dominance by restricting third-party developers’ access to its platform unless they agreed not to compete with Meta’s primary services. This decision narrows the scope of the trial, although Boasberg did not set a date for the proceedings.

Meta has maintained that its acquisitions have fostered consumer choice and competition, a position it will uphold in court. “We are confident that the evidence at trial will show that the acquisitions of Instagram and WhatsApp have been good for competition and consumers,” a Meta spokesperson said, per Reuters.

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FTC spokesperson Douglas Farrar, meanwhile, asserted that the lawsuit, initially launched under former President Donald Trump and later refined under President Joe Biden, represents a bipartisan push to curb what the agency views as Meta’s monopolistic control over social media. According to Farrar, the case’s ultimate goal is to “restore competition to ensure freedom and innovation in the social media ecosystem.”

In a significant ruling for the case’s scope, Boasberg also prohibited Meta from arguing that its acquisition of WhatsApp bolstered competition by enhancing its position against rivals like Apple and Google, reported Reuters. This restriction limits Meta’s defense options as it prepares to make its case in court.

Meta had sought to dismiss the FTC’s lawsuit in its entirety, claiming that the complaint failed to account for the rapidly evolving competitive landscape of social media, where platforms like TikTok, YouTube, X (formerly Twitter), and LinkedIn have gained traction in recent years. However, the judge’s decision highlights the FTC’s broader mission to address alleged anticompetitive practices in the tech industry. According to Reuters, this case is just one of several high-stakes lawsuits currently aimed at Big Tech firms, with both Amazon and Apple also facing legal action. Google, owned by Alphabet, is confronting two separate antitrust lawsuits, including one in which a judge recently ruled that it had unlawfully limited competition in the online search market.

The judge has indicated that a detailed order on his ruling, with redactions for commercially sensitive information, will be made public later on Wednesday. This lawsuit marks a pivotal moment in U.S. regulatory efforts to challenge Big Tech’s dominance, with the outcome of Meta’s trial expected to set a precedent for future antitrust actions in the digital marketplace.

Source: Reuters