A bipartisan coalition of state attorneys general on Wednesday filed an antitrust lawsuit against Facebook that accuses the tech giant of acquiring smaller companies to curb competition.
More pointedly, the lawsuit seeks to force Facebook to divest from Instagram and WhatsApp, two of its highest-profile acquisitions over the last decade.
"We want to see Facebook stop abusing its market power to prejudice consumers, competitors, and also third-party app and software developers," Connecticut Attorney General William Tong told Cheddar. "We want to see Facebook stop its practice of either buy-or-bury its competition and trying to crush anybody who threatens Facebook."
Facebook founder and CEO Mark Zuckerberg has pushed back against this characterization of its acquisitions, saying those companies would not have flourished without being purchased.
Tong said this is irrelevant to what he sees as the anti-competitive intent behind the acquisitions.
"The bottom line is that we believe that Facebook's strategy is to buy or bury," he said. "As Mark Zuckerberg said, he wants to create a competitive moat around Facebook, and he used that imagery himself, which means he wants Facebook to be impervious from competition."
This strategy of buying other companies to clear the market of competitors becomes more of a problem, and indeed possibly illegal, when a company has monopoly power, which Tong and the other attorneys general argue Facebook has over the social media market.
"You could make an argument that you have some other choices," he said. "The fact is is that Facebook has a monopoly, and it is in a unique position to limit consumer choice."
For the consumers, he added, this has meant a lack of choice and a lack of effective safeguards for personal data.
One demand embedded in the lawsuit is that Facebook should be legally forced to notify the public when it's making an acquisition worth more than $10 million.
"They should let us know, so that we have the opportunity to analyze that potential acquisition and take action if we think it's necessary in the public interest and in the interests of our states, and potentially to stop Facebook from making that acquisition," Tong said.
The tech giant now faces multiple legal challenges. On Wednesday, the Federal Trade Commission also filed a lawsuit against the company alleging anticompetitive conduct.
"Facebook’s actions to entrench and maintain its monopoly deny consumers the benefits of competition," said Ian Conner, director of the agency's Bureau of Competition, in a statement. "Our aim is to roll back Facebook’s anticompetitive conduct and restore competition so that innovation and free competition can thrive."
