The US Government Is Taking Legal Action To Break Up Facebook

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Forty-eight attorneys general and the Federal Trade Commission say Facebook Needs To Sell Instagram And WhatsApp.

Facebook has used illegal monopoly power and an “unlawful scheme” to stifle competition, degrade personal privacy, and crush rivals, according to antitrust lawsuits filed Wednesday by 48 state attorneys general and the Federal Trade Commission.

“For nearly a decade, Facebook has used its dominance and monopoly power to crush smaller rivals and snuff out competition, all at the expense of everyday users,” New York Attorney General Letitia James said at a press conference announcing the action. “By using its vast troves of data and money, Facebook has squashed or hindered what the company perceived as potential threats.”

James said the company’s “unlawful scheme” has reduced choices for consumers and “degraded privacy protections for millions of Americans.”

The lawsuit is asking the courts to block Facebook from major new acquisitions and to potentially force it to divest its major assets, including WhatsApp and Instagram. Furthermore, the attorney generals have asked the courts to require Facebook to seek their approval for any acquisition valued at or above $10 million. In the tech world, that means pretty means all acquisitions.

“Facebook’s actions to entrench and maintain its monopoly deny consumers the benefits of competition,” said Ian Conner, director of the FTC’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.”

Will Facebook be forced to sell WhatsApp and Instagram?

In a statement, Jennifer Newstead, Facebook’s VP and general counsel, called the lawsuits’ allegations “revisionist history.”

“Instagram and WhatsApp became the incredible products they are today because Facebook invested billions of dollars, and years of innovation and expertise, to develop new features and better experiences for the millions who enjoy those products,” she said. “The most important fact in this case, which the Commission does not mention in its 53-page complaint, is that it cleared these acquisitions years ago. The government now wants a do-over, sending a chilling warning to American business that no sale is ever final.”

Facebook previously defended its actions and acquisitions after the House Antitrust Subcommittee released a report in October that said it and other tech giants have abused their monopoly power.

You can read Facebook’s full response here.