Sunday, January 17, 2021

New US lawsuits could force Facebook to sell Instagram, WhatsApp | News from the United States and Canada

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With the filing of the two U.S. lawsuits, Facebook is the second major tech company to face a major legal challenge.

The United States Federal Trade Commission and nearly every state in the United States sued Facebook Inc on Wednesday, saying it violated antitrust law and should potentially be dismantled.

With the filing of the two lawsuits, Facebook becomes the second major tech company to face a major legal challenge this fall.

The FTC said in a statement it would seek an injunction that “could, among other things: require the divestment of assets, including Instagram and WhatsApp.”

In its complaint, the coalition of 46 states, Washington, DC and Guam also called for Facebook’s acquisitions of Instagram and WhatsApp to be ruled illegal.

“For nearly a decade, Facebook has used its dominance and monopoly power to crush smaller rivals, stifle competition, all to the detriment of everyday users,” New York Attorney General Letitia James said.

James said the company used huge sums of money to acquire such rivals before they could threaten the company’s dominance.

Facebook said it was reviewing complaints from the FTC and state antitrust.

The company said the government “now wants an overhaul regardless of the impact the previous one would have on the business community at large or on the people who choose our products every day.”

The US Department of Justice sued Alphabet Inc’s Google in October, accusing the trillion-dollar company of using its market power to fend off rivals.

The lawsuits are the largest antitrust cases in a generation, comparable to the lawsuit against Microsoft Corp in 1998. The federal government ultimately settled this case, but the years-long legal struggle and protracted antitrust review prevented the company from thwarting its competitors and are credited with paving the way for the explosive growth of the Internet.

Facebook shares fell 3% after the news before cutting losses and were down 2%.



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