Federal Judge Throws Out Facebook Antitrust Cases

Posted on June 29, 2021 by Paul Thurrott in Social with 21 Comments

Citing a lack of evidence, a US District Court judge has thrown out two federal and state antitrust cases against Facebook. The firm’s stock exploded as a result, placing its market capitalization above $1 trillion for the first time.

“We are pleased that today’s decisions recognize the defects in the government complaints filed against Facebook,” a Facebook statement reads. “We compete fairly every day to earn people’s time and attention and will continue to deliver great products for the people and businesses that use our services.”

Judge James Boasberg of the US District Court for the District of Columbia threw out two cases: One brought by the Federal Trade Commission (FTC) and a me-too suit filed by the attorneys general of over 40 US states. He said that both cases were “legally insufficient” and that the FTC “failed to plead enough facts to plausibly establish” that Facebook had a monopoly that it was abusing.

Following a 16-month investigation, the FTC says it established that Facebook was an abusive and anticompetitive monopolist. It had been seeking to have WhatsApp and Instagram taken away from Facebook, which owns a dominant position in the social media market and is arguably the most terrible company on earth. The FTC has until July 29 to file a new case. Fortunately, Facebook also faces similar antitrust lawsuits in the EU and UK.

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Comments (21)

21 responses to “Federal Judge Throws Out Facebook Antitrust Cases”

  1. ringofvoid

    Hmmmm.... It might be worth looking at that judges bank account for suspicious large deposits.

    • bluvg

      They may make unpopular decisions (which, if based on the law, isn't a bad thing), but being on the take is very rarely a fair criticism of any US federal judge.

      • mefree

        Ruling based on political bias and not the law very much is.

        • bluvg

          No. RBG and Scalia may have been branded as biased, for example, but they were not in it for personal profit. On the contrary, they could have made much more in private practice. That is true of nearly every judicial position--the salary is a huge pay cut vs. their other career options.

          • mefree

            ? I wasn't inferring for profit, I was saying on bias. I guess you didn't even read what I wrote.

            • bluvg

              "It might be worth looking at that judges bank account"

              "being on the take is very rarely a fair criticism"

              "Ruling based on political bias and not the law very much is"

              ... a criticism of them being on the take (aka bribe)? Or ruling based on political bias is also very rarely a fair criticism, or a fair criticism? Sorry if I misread, but I assumed your comment was in the context of bribery. I would offer that federal judges are typically not political pawns, though judicial appointments are often popularly portrayed that way.

  2. bob_shutts

    The EU rules are more up-to-date with respect to what constitutes unfair competition. U.S. rules were drafted when railroad conglomerates were the big issue.

    • locust_infested_orchard_inc.

      Yes indeed. Margrethe Vestager currently holds two positions at the EU Commission:

      European Commissioner for Competition

      ➋ Executive Vice President of the European Commission for A Europe Fit for the Digital Age

      She is a pragmatic no-nonsense individual who has the guts to holds the tech belligerents feet to the fire, unlike the US.

      Much love to Margrethe.

  3. John Craig

    This isn't having a pop at any one nation in particular, because I understand that laws differ across the globe and I'm sure that's the USA would like to reign in big tech as much as the next country, but it seems to me that it's going to fall to the EU primarily to sort out these companies, and that's a problem. It needs to be a joint effort on everyone's part. Australia handed Google and Facebook a real wake up call earlier this year, and that's just the first in a long line of shots they have in the barrel for big tech. Surely the USA, where these companies originate, has to get more aggressive and decisive in its approach to big tech monopolies, unfair tax practices, and general misbehaviour.

    • Greg Green

      Maybe it’s because the companies started in the US, then started paying the political system early on to get the laws sculpted the way the companies needed, rather than overseas where countries had the opportunity to make laws before the political contributions came in.

      if that’s the case then the US congress may never catch up.

  4. mi1984

    They need to ramp up the FTC and audit it as well, I remember a time when people weren't trying to scam you online all the time, when email and websites had some integrity. When I didn't have to worry about blocking phone calls. Yes ... the olden days. There were "pop ups" but at least you could tell people how to block them easier than this clickbait garbadge on just about every site.

    Companies saying they're competing fairly in this environment means little.

    End Clickbait.

  5. mefree

    Lack of evidence? That's hilarious!

  6. lvthunder

    What an embarrassment to the FTC. They couldn't even prove to the judge it was worth going to trial. What a big waste of taxpayer's money.

  7. locust_infested_orchard_inc.

    Fakebook is not worth 1¢, let alone $1 trillion. ? ?

  8. red.radar

    Looks like the courts definition of Monopoly is much narrower than believed.

    This is evidence that it is time for Congress to update the laws and stop trying to hide behind legal frameworks designed to break up industrial titans from the 19th century.

    • karlinhigh

      Here is part of the Judge's ruling, found via Ben Thompson:

      The Court’s decision here does not rest on some pleading technicality or arcane feature of antitrust law. Rather, the existence of market power is at the heart of any monopolization claim. As the Supreme Court explained in Twombly, itself an antitrust case, “[A] district court must retain the power to insist upon some specificity in pleading before allowing a potentially massive factual controversy to proceed.” Here, this Court must exercise that power. The FTC’s Complaint says almost nothing concrete on the key question of how much power Facebook actually had, and still has, in a properly defined antitrust product market. It is almost as if the agency expects the Court to simply nod to the conventional wisdom that Facebook is a monopolist. After all, no one who hears the title of the 2010 film “The Social Network” wonders which company it is about. Yet, whatever it may mean to the public, “monopoly power” is a term of art under federal law with a precise economic meaning: the power to profitably raise prices or exclude competition in a properly defined market.

      One goal of Antitrust law is preserve competition and consumer choice.

      Now, what happens if the great majority of consumers all choose the same thing, because they feel it best meets their purposes?

      Should the government say "Some of you must not choose this, because the product or service will be 'too big' then?"

      Destroying consumer choice in order to save it?

      (Disclosure: I have never had a Facebook account, as a matter of principle.)

    • Paul Thurrott

      That's not what this means. It means only that the cases were light on details. They can refile (and will).

      • pecosbob04

        Of course one has to ask, why rush to file a deficient case in the first place. Was there some kind of time pressure? None that I am aware of. Never a good strategy to throw weak paper while counting on fixing it on the second cut. Then again maybe they went with their best case and it wasn't all that.

  9. bob_shutts

    Pleadings are dismissed all the time. Could be a picky judge or young lawyers were tasked with drafting the complaint and did a poor job.

    In all cases a good pleading must set forth a series of facts that give rise to relief. A bunch of mere conclusions is insufficient.

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