Facebook Break-up Looms? 40 US States to Sue Tech Giant for Antitrust Violations

As many as 40 states in the United States will sue Facebook Inc for possible antitrust violations, Reuters has reported. The states, led by New York state, could file a lawsuit against Facebook next week, the agency reported, citing four sources familiar with the matter.

Congress Subcommittee for Judiciary Antitrust, Commercial and Administrative Law had grilled Facebook CEO Mark Zuckerberg, along with the CEOs of Google, Apple and Amazon in July as part of its historic anti-trust hearing in July.

The Justice Department sued Alphabet Inc's Google in October. Facebook, as well as the spokesman for the New York attorney general's office, declined comments.

Tech Antitrust Hearing
All the four CEOs testified via video conferencing YouTube Grab

Gobbling up Smaller Rivals

The social media behemoth has often been accused of antitrust violations and gobbling up smaller rivals. The acquisition of platforms like WhatsApp and Instagram had put Facebook in the dock, though Zuckerberg aggressively defended the acquisitions. Facebook bought Instagram in 2012 and WhatsApp in 2014.

The antitrust investigations against Facebook had begun in 2019. Reports said in early October that the House committee's antitrust report contained a "thinly veiled call to break up" Facebook, along with other tech majors like Amazon, Apple and Google.

The draft report mentions Big Tech's practices like 'killer acquisitions', elimination of rivals and self-preferencing. The report also contains a proposal under which the tech companies will have to mark a 'single line of business'.

mark zuckerberg

There was no clarity about whether the report, which was written by a committee headed by Democrat David Cicilline. It was not clear if there's enough bipartisan report that warrants the implementation of this recommendation.

However, it looks like the latest report about multiple states mulling a lawsuit against Facebook is a straw in the wind.

Dilute Monopolistic Powers

Among other recommendations in the report was a proposal to dilute some of the monopolistic powers the tech majors enjoy. One of the suggestions was to make it easier for the Justice Department and Federal Trade Commission (FTC) to stop mergers by 'lowering their burden of proof'. This empowers consumers to take control of their data through data portability and interoperability between platforms, the report adds.

During the antitrust hearing in July, Zuckerberg was asked about a 2012 conversation in which he had openly told Facebook's senior engineers that his policy was to "buy just by any competitive startup."

But he argued that Instagram and WhatsApp would have remained small, insignificant companies had they not been acquired by Facebook.