Illinois Joins Suit Accusing Facebook Of Creating Monopoly

ILLINOIS — The Federal Trade Commission, with bipartisan support from attorneys general in Illinois and dozens of other states, filed an antitrust lawsuit in federal court Wednesday against social media giant Facebook.

In the suit, the FTC accuses the company of illegally dominating the social media industry and eliminating business threats through years of monopolization and anti-competitive conduct.

“For nearly a decade, Facebook has profited tremendously by monetizing the personal information and online habits of users. Key to its strategy has been impeding and eliminating any perceived competition, ensuring that users have no alternative to Facebook’s platform,” Illinois Attorney General Kwame Raoul said in a statement. “Facebook’s ruthless anticompetitive practices have stifled innovation, harmed small businesses, and most importantly, reduced privacy protections and alternatives so that it could continue to earn billions of dollars at users’ expense. I am joining my colleagues around the country to ask the court to end Facebook’s monopoly and give consumers the choice and protections they deserve.”

According to the complaint, Facebook has used a “systematic strategy” over the years to eliminate threats to its business. This includes the company’s acquisition of Instagram in 2012 and mobile messaging app WhatsApp in 2014, both of which were perceived as an “existential threat to Facebook’s monopoly power.”

The lawsuit also alleges Facebook has limited third-party software developers’ access to its platform, allowing access only after developers “refrain from developing competing functionalities, and from connecting with or promoting other social networking services.”

As a result of its actions, the lawsuit alleges, Facebook has seen “staggering” profits. Last year, Facebook generated revenues of more than $70 billion and profits of more than $18.5 billion.

The complaint states that Facebook’s actions have not only harmed competition but also left consumers with few choices for personal social networking and deprived advertisers of the benefits of competition.

With the suit, the FTC is seeking an injunction in federal court that could require Facebook to divest its assets, including Instagram and WhatsApp, and require Facebook to seek prior approval for future mergers and acquisitions.

“Personal social networking is central to the lives of millions of Americans,” Ian Conner, director of the FTC’s Bureau of Competition, said in a news release. “Our aim is to roll back Facebook’s anti-competitive conduct and restore competition so that innovation and free competition can thrive.”

The lawsuit was filed following an investigation by the FTC’s Technology Enforcement Division.

Attorneys general from 46 states, the District of Columbia and Guam comprise the bipartisan coalition that signed on in support of the lawsuit.