WASHINGTON, D.C. —­­ Today, the Federal Trade Commission filed an antitrust lawsuit against Facebook, with 48 state attorneys general joining a separate lawsuit. The FTC alleges that Facebook “has maintained its monopoly position by buying up companies that present competitive threats and by imposing restrictive policies that unjustifiably hinder actual or potential rivals that Facebook does not or cannot acquire.” The states allege that “Facebook illegally maintains that monopoly power by deploying a buy-or-bury strategy that thwarts competition and harms both users and advertisers.”

The FTC’s lawsuit reads like a work of creative alternative history,” said Asheesh Agarwal, Deputy General Counsel of TechFreedom. “The FTC assumes that these companies would have grown into giants if left alone, but in reality, it has no idea what would have happened. This is pure hindsight bias. Even worse, by filing this lawsuit, the FTC will discourage companies from investing in start-ups and thereby hinder innovation. Rather than punishing companies for their size and success, antitrust law should focus on actual harm to consumers.” 

Agarwal placed the lawsuit in historical context: “Throughout America’s economic history, large companies have acquired smaller firms in ways that promoted competition by allowing merged firms to develop new products and to bring those products to more consumers more quickly. President Trump’s own Council of Economic Advisers concluded that overly aggressive merger review could reduce venture capital funding for start-ups.”    

“Today, consumers can easily access many other social media sites at no monetary cost and in virtually no time,” continued Agarwal. “Given these other options, it is unclear how this lawsuit actually helps consumers.”


Read our related work including:

  • Our recent white paper, which explains how, throughout America’s economic history, large companies have acquired smaller firms in ways that helped consumers and advanced innovation.
  • Episode #281 of the Tech Policy Podcast: Should companies be allowed to acquire their start-up competitors?
  • Our analysis of the Google lawsuit
  • Our analysis of how an overly aggressive antitrust lawsuit could benefit China. 
  • Our analysis of the House Judiciary Antitrust Report
  • Our press release analyzing the House Judiciary Antitrust Report
  • Our op-ed ahead of the recent antitrust hearings
  • Our comments on the draft vertical merger guidelines
  • Our press release on the vertical merger guidelines
  • Szóka’s op-ed in The Seattle Times: Trump vs. Bezos: The president is on the wrong side of the Constitution
  • Our 2018 coalition letter to Jeff Sessions warning against using the antitrust laws to influence online speech
  • Our statement on the court decision blocking DOJ’s lawsuit to stop the AT&T/Time Warner merger
  • Our 2015 coalition letter urging Congress to bar the FCC from imposing merger conditions not specific to harms caused by a merger, or that the FCC could not impose by regulation