with Aaron Schaffer
The Washington federal judge said the Federal Trade Commission didn't provide enough evidence to prove that Facebook controlled 60 percent of the social media market, and he gave the agency 30 days to file an amended complaint, as I reported with my colleague Rachel Lerman. In a second lawsuit, he said a group of state attorneys general had waited too long to challenge two of the company's key acquisitions, of WhatsApp in 2014 and Instagram in 2012.
Rep. Jerrold Nadler (D-N.Y.), the chair of the House Judiciary Committee, and Rep. David Cicilline (D-R.I.), the chair of the committee's antitrust subcommittee, called for Congress to pass a package of bills that would overhaul tech companies in a joint response to the decisions.
“As the FTC and 48 State Attorneys General have alleged, Facebook is a monopolist, and it has abused its monopoly power to buy or bury its competitive threats,” the lawmakers said. “In the weeks ahead, we will work to advance this legislation to restore choice, innovation, and opportunity for American businesses and consumers.”
And Rep. Ken Buck (Colo.), the subcommittee's top Republican, said it showed that changes are “urgently needed.”
“Congress needs to provide additional tools and resources to our antitrust enforcers to go after Big Tech companies engaging in anticompetitive conduct,” he tweeted shortly after the decision came down.
The dismissal was a rare reprieve for Facebook at a time of escalating scrutiny of the tech industry in Washington.
The company's stock price rose on the news, for the first time pushing the company to a valuation above $1 trillion. Facebook's critics are already seizing on that development to argue the competition framework in the United States is outdated amid a major legislative push.
“Advocates for legislative reforms are going to say this shows why we need new statutes,” William E. Kovacic, a former Republican FTC chair and a professor at George Washington University Law School, told The Technology 202. “This will be their chief example.”
The push to overhaul U.S. competition laws is at a critical moment.
A package of six bills last week cleared a first hurdle in Congress as they were advanced by the House Judiciary Committee. But a marathon 29-hour debate before that exposed key divisions over the legislation, and raised questions about whether the bills would have the support they need to pass the House or Senate.
Sen. Amy Klobuchar (D-Minn.), who chairs the Senate Judiciary antitrust subcommittee, said the judge's opinions show why the U.S. court system is not currently equipped to tackle tech giants' power.
“This ruling also 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,” she wrote.
The move is a significant blow to the Federal Trade Commission.
The FTC spent significant resources probing Facebook for both anticompetitive behavior and privacy failures under the Trump administration. Now the agency will have to revisit the case under its new chair, the prominent tech industry critic Lina Khan.
“The FTC is closely reviewing the opinion and assessing the best option forward,” Federal Trade Commission spokeswoman Lindsay Kryzak said in a statement.
The commission for years has faced criticism that it isn't doing enough to rein in tech giants. When the agency slapped Facebook with a historic, $5 billion fine, critics widely viewed it as a gift to the company. Many members of Congress called for greater resources for the agency in the fallout of Monday's news.
Tech companies argued the decision shows why antitrust laws should stay the same.
“Activists might say we need new antitrust laws, but the Federal Trade Commission’s departure from tradition into subjective antitrust enforcement has illustrated the very need for our laws to continue to be applied objectively and fairly, said Carl Szabo, vice president and general counsel at NetChoice.
Facebook praised the court's decision.
“We are pleased that today’s decisions recognize the defects in the government complaints filed against Facebook,” spokesman Christopher Sgro said. “We compete fairly every day to earn people’s time and attention and will continue to deliver great products for the people and businesses that use our services.”
Rant and rave
Journalist Casey Newton noticed some odd language in the opinion:
Although it's a reprieve for Facebook, the company still has a long way to go, the New York Times's Shira Ovide notes:
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A bipartisan group of state attorneys general called on Congress to bolster the FTC’s ability to obtain consumer refunds.
States are being forced to take over some FTC duties in the wake of a recent Supreme Court decision, taking away resources from their consumer protection efforts, 28 attorneys general said in a letter. The Supreme Court in April unanimously said that federal regulators didn’t have the authority to go to court to wrestle huge penalties from corporations.
“If FTC authority to secure equitable monetary relief is not restored, the harm suffered by consumers and law-abiding businesses as a result of these and other illegal schemes may go unredressed,” they said.
Protests in Southern California highlight the persistent influence of social media misinformation in the post-Trump era.
The movement has shut down a vaccination site and pressured government officials to shelve a plan to build digital vaccine passports, Elizabeth Dwoskin reports. Despite tech companies' crackdown on baseless claims and the people who push them, influencers have moved to less-policed platforms and reemerged on major websites, allowing them to rack up major wins.
More than a dozen activists who spoke with The Post said their movement is about more than public health measures.
“This is a humanitarian issue,” said Jason Lefkowitz, a Los Angeles-based organizer behind the Dodger Stadium anti-vaccine protest and others. “It is about our civil liberties being taken away over a made-up pandemic. It is a global war over everything.” More than 600,000 people in the United States have died of the coronavirus.
YouTube banned, then restored, an account belonging to a watchdog group that scrutinizes right-wing media.
YouTube said Right Wing Watch’s channel was “mistakenly suspended,” the Daily Beast’s Justin Baragona and Adam Rawnsley report. But the move came as YouTube’s content moderation policies, which also recently hit a group critical of how China treats Uyghurs in Xinjiang, face scrutiny.
Right Wing Watch is run by liberal advocacy group People For the American Way.
“We are glad that by reinstating our account, YouTube recognizes our position that there is a world of difference between reporting on offensive activities and committing them,” said Adele Stan, Right Wing Watch’s director. “Without the ability to accurately portray dangerous behavior, meaningful journalism and public education about that behavior would cease to exist.”
Inside the industry
- Simon & Schuster will publish a book by Rep. Ro Khanna (D-Calif.) on Feb. 1, 2022. The book is titled “Dignity in a Digital Age: Making Tech Work for All of Us.”
- Acting Federal Communications Commission chairwoman Jessica Rosenworcel discusses the Emergency Broadband Benefit program at a New America event today at noon.
- Rosenworcel also discusses the program at a Communications Workers of America event today at 7:30 p.m.
- The House Energy and Commerce Committee holds a hearing on securing U.S. networks on Wednesday at 10:30 a.m.
- The Federal Trade Commission holds an open meeting on Thursday at noon.