The details of the ruling really show (as we had suggested earlier) that it appears that the government really tried to rush all these cases, and did so with weak arguments just to get a case started, without thinking that just because you say something is true you can't get a court to buy it without support:Court Tosses Both FTC And States' Antitrust Cases Against Facebook; You Gotta Have More Than 'Big Facebook Bad'
from the ouch dept
"On Monday a judge ruled on both the cases against Facebook -- and dismissed them both. In both cases, the Court highlights the very problems we noted in our initial writeup about these cases. They seem to assume that "obviously" Facebook is a monopoly and "obviously" it's doing anti-competitive bad stuff. But... the problem with insisting that it's all "obvious" is that you have to actually show that in your complaint. And that didn't happen in either of these cases.
The court, fairly easily, dismissed the FTC's case, though left it open for the FTC to amend the case and try again (which it will almost certainly do). The judge highlighted the exact same problem I raised in my post about the key weakness in the case: it fails to show evidence that Facebook has a monopoly.The question now is what will the FTC do in response. It could try to come back with another attempt with a better market definition -- even though the court seems somewhat skeptical that it could do so successfully. The other option, which some are speculating about, is that the FTC could try again using a totally different legal theory, basically arguing unfair competition, rather than abuse of market power. Of course, as former FTC Commissioner Joshua Wright has detailed, taking this latter approach could lead the courts to significantly limiting the FTC's authority -- meaning it could backfire spectacularly.
As for the States' case against Facebook, it fails for even dumber reasons. When the case was first filed, we noted how it tells a narrative that left out a ton of important context. The case focuses on Facebook's purchases of both WhatsApp and Instagram, and tries to argue that after sucking a bunch of companies in to use Facebook's platform, it then cut back on the API access to functionalities to keep competitors out. That, of course, leaves out the context of reasons why Facebook changed its approach to the API and how it had to deal with situations like Cambridge Analytica's abuse of the API to suck out a ton of data.
But the real problem with the States' case? They brought it way too late . . .Many people have taken it for granted that Facebook is clearly violating antitrust law, but the lawyers bringing these cases against the company can't take that for granted, or assume that it's obvious. They have to prove it to a court, and, as these two rulings show, they failed to do so in either case.
Filed Under: antitrust, competition, ftc, market power, states
Companies: facebook
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