FTC Files Amended Complaint Against Leading Social Media Technology Company – Antitrust / Competition Law

United States: FTC files amended lawsuit against leading social media technology company

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The FTC deposit an amended antitrust complaint against Facebook, alleging that the company bought two main competitors and engaged in illegal “buy or bury” and “open-first-close-later” programs. Amended complaint follows U.S. district court for the District of Columbia recent decision dismiss the FTC’s original complaint.

In the amended complaint, the FTC alleged that Facebook took steps to “solidify” its monopoly by buying out rivals Instagram and WhatsApp in the 2010s – a time of transition to an era of mobile-centric communication. The FTC alleged that Facebook applied anti-competitive conditional use policies to app developers, granting access to its platform to developers on the condition that they agree (i) not to compete with basic services of the company and (ii) not to facilitate the growth of potential competitors. The FTC alleged that Facebook “supplemented its anti-competitive buying frenzy” with “buy or bury” and “open-first-close-later programs” that hamper[ed] the ability of rivals and potential rivals to “compete on the merits”, “thereby harming the competitive process and limited consumer choice”.

The FTC alleged that Facebook violated Section 5 (a) of the Federal Trade Commission Act and Section 2 of the Sherman Act.

FTC Commissioner Christine S. Wilson dissident filing because the amended claims focus on competitor acquisitions, transactions previously assessed and cleared by the FTC as part of the Hart-Scott-Rodino pre-merger notification process. Ms Wilson said it is “bad policy to undermine the integrity of the pre-merger notification process established by Congress and the rest it provides to merger parties who have faithfully complied with its demands.” .

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