Facebook faces lawsuit over predatory conduct, may sell Instagram and Whatsapp
The world’s biggest social media giant, Facebook is currently facing litigation battle standing accused of using illegal tactics to dominate the industry.
In a multiple lawsuit filed against the company, the United States Federal Trade Commission alongside some US states says it is violating antitrust laws and should potentially be broken up making it the second biggest tech company to face a major legal challenge this year that’s after the US state department of Justice sued Google for violating competition laws.
New York Attorney General, Leticia James, who leads the suit with 48 states spoke in a press conference saying that for nearly a decade the social media firm has used its dominance and monopoly power to crush smaller rivals and snuff out competition all at the expense of everyday users.
“Today, we are taking action to stand up for the millions of consumers and many small businesses that have been harmed by Facebook’s illegal behavior. Instead of competing on the merits, Facebook used its power to suppress competition so it could take advantage of users and make billions by converting personal data into a cash cow.” James said.
The Federal Trade Commission in it’s complaint is asking the court to judge Facebook’s acquisition of Whatsapp and Instagram as illegal and also to consider breaking it up which if successful, could result in the first breakup of a U.S. company in decades.
Mitch Stoltz, a tech expert with Electronic Frontier Foundation reacting to the development said “the FTC and other authorities have tried suits and settlements for money damages against the big tech companies in the past and there’s really no amount of money that will change their behaviour and so they are smart to focus on actual limits on their conduct and also potentially rolling back some of those mergers”.
The move has been said to be a government crackdown on big tech power. Speaking on this, Thaddeus Hoffmeister, a Law Professor in University of Dayton noted that Facebook has grown to a very huge size and if monopolies are allowed to have much control in the industry, it will stifle competition.
Facebook has reacted saying that the lawsuits Filed by the FTC and the State Attorneys General are revisionist history while noting that they are reviewing the complaints and they have more to day soon.
Zuckerberg has basically said companies often make acquisitions in the normal course of business and that it offers a free service to users, none of whom are forced to be on the platform.
In 2019, Facebook was fined 5 billion dollars which is the largest penalty of its kind for privacy violations.
The lawsuits against Facebook is seen as one of the biggest anti-trust cases to enter the US courts in more than two decades and projections say it is expected to be battled out for years to come.