40+ States Could Join Antitrust Lawsuit Against Facebook

Facebook could soon be staring down a lawsuit as the Federal Trade Commission and numerous states attorneys general finish up one or more antitrust cases against the social media giant, Reuters reports.

One source told Reuters that FTC staff has recommended that commissioners sue Facebook in federal court so as to let a group of states led by New York join in the suit. The suit, according to Reuters, could contain up to 41 states, and the filing of the suits could bleed into 2021.

Letitia James, New York Attorney General, in response, said they “don’t comment on the details of an ongoing investigation, but as we have said before, we will continue to use every investigative tool at our disposal to determine whether Facebook’s actions stifled competition, reduced choices, or put user data at risk,” Reuters reports.

The lawsuits are expected to focus on Facebook’s reported violations of antitrust law in order to keep its robust share of the market, Reuters reports. The lawsuits converge and differ on various points, but one of the main ones is the 2012 acquisition of Instagram for $1 billion, which the suit alleges stifled competition in the social media field, and another being its weakening of privacy protections in the acquisition of WhatsApp for $22 billion in 2014.

Also, the lawsuits are likely to allege that Facebook withheld data from rival companies as a method to crush competition.

The approval of Facebook’s purchases of WhatsApp and Instagram drew fire from startup investors, privacy activists and antitrust experts.

FTC Chair Joe Simons said recently that antitrust enforcers should keep an eye out for big companies buying up emerging startups in their same fields. Simons said those deals could be harmful to consumers as they have the effect of cleanly eliminating what the bigger companies perceive as threats. He said threats to competition might not be obvious, and so officials needed to keep a keen eye open.