Antitrust hawks say Facebook case highlights need for new laws
Federal judge tossing Facebook monopoly case prompts calls from both parties to pass new antitrust laws that apply to Big Tech companies
Democrats and Republicans alike on Tuesday renewed their calls for new antitrust laws after a federal judge tossed out a complaint by the Federal Trade Commission accusing Facebook of illegally wielding monopoly power.
Leaders on the House Judiciary Committee, which last week approved five legislative proposals to regulate Facebook and other major technology companies, said the ruling by District Judge James E. Boasberg of the U.S. District Court for the District of Columbia emphasized the need to update long-standing codes to regulate a rapidly changing online marketplace.
“This decision underscores the dire need to modernize our antitrust laws to address anti-competitive mergers and abusive conduct in the digital economy,” said Judiciary Chairman Jerrold Nadler, D-N.Y., and Rep. David Cicilline, D-R.I., who chairs the antitrust subcommittee.
Rep. Ken Buck of Colorado, the subcommittee’s top Republican, said “Congress needs to provide additional tools and resources to our antitrust enforcers to go after Big Tech companies engaging in anti-competitive conduct.”
The ruling by Boasberg on Monday said the FTC had provided “legally insufficient” evidence that Facebook was a monopolist in its past acquisitions of Instagram and WhatsApp. The decision highlights the uphill challenge facing antitrust hawks even as polls show Americans in favor of increased regulation of Big Tech companies.
“The FTC has failed to plead enough facts to plausibly establish a necessary element of all of its claims [...] – namely, that Facebook has monopoly power in the market for Personal Social Networking Services,” Boasberg wrote in his decision.
In a statement, a Facebook spokesperson praised the ruling for “recognizing the defects” in the government’s complaint.
Critics of Facebook, Apple, Amazon and Google say the price-based consumer welfare standard that has dominated antitrust case law for decades is not sufficient for gauging the monopoly power wielded by online companies that provide services largely free of cost.
Boasberg gave the FTC until July 29 to refile its complaint with new evidence. The revised complaint will be the first major challenge for new commission Chairwoman Lina Khan.
The ruling “illustrates precisely why our competition laws need to be updated — after decades of binding Supreme Court decisions that have weakened our antitrust policies, we cannot rely on our courts to keep our markets competitive, open and fair,” said Sen. Amy Klobuchar, D-Minn., who chairs the Senate Judiciary antitrust subcommittee.
Another member of the Senate subcommittee, Sen. Richard Blumenthal, D-Conn., acknowledged in a statement that the government’s case “wasn’t clear under our current antitrust laws that Facebook has a monopoly in online networking, a flabbergasting assertion given Facebook’s firm grip over consumers, their data, and the social media market.”
“If that isn’t an open-and-shut case for updating our antitrust laws so that we can stand up to Big Tech, I don’t know what is,” Blumenthal said.