Brumpost
  • COVID-19
  • Best Products
  • News
  • How Tos
  • The Bargainer
  • Reviews
  • Tireposts
  • @Work
  • 5G
No Result
View All Result
Brumpost
Home News Culture

Facebook in another big lawsuit that could force it to sell off WhatsApp and Instagram

The company had been accused of buying out competitors a practice that could force it to sell off its biggest assets

Eva Derika by Eva Derika
4 months ago
in Culture
Reading Time: 4 mins read
A A
0
Share on FacebookShare on TwitterPin It

Facebook is currently in hot waters and could be forced to sell off its prized assets which includes both WhatsApp and Instagram after the U.S. Federal Trade Commission and U.S. state filed lawsuits against the social media giant stating it used the “Buy or bury” strategy to snap up rivals and keeping the smaller ones at bay.

ADVERTISEMENT

The massive lawsuit against Facebook on Wednesday makes it the second big tech company to face such a major legal challenge this year after Alphabet got sued by the U.S. Justice Department back in October accusing the company of using its market power to fend off its rivals.

The lawsuit explains the growing bipartisan consensus meant to hold big tech companies accountable for their business practices as well as mark a rare moment of agreement between the Trump Administration and Joe Biden’s democrats which had been an advocate of breaking up big tech companies such as Facebook and Google.

Facebook was accused of buying up rival social media companies. Though not new ones as this involves the acquisition of the photo sharing platform Instagram which was acquired for US$1 billion back in 2012 as well as WhatsApp which was bought for US$19 billion in 2014.

According to the federal and state regulators, the acquisition is said to be anti-competitive.

“For nearly a decade, Facebook has used its dominance and monopoly power to crush smaller rivals, snuff out competition, all at the expense of everyday users,” said New York Attorney General Letitia James on behalf of the coalition of 46 states, Washington, D.C. and Guam. Alabama, Georgia, South Carolina and South Dakota did not participate in the lawsuit.

James stated that the acquisition were made before these companies ever become big basically as Facebook projects their growth to likely dominate the social media platform over time.

Meanwhile the social network giant counsel Jennifer Newstead called the lawsuits “revisionist history” and also said the antitrust law do not exist to punish “successful companies”.

She said WhatsApp and Instagram have succeeded after Facebook invested billions of dollars in growing the apps.

“The government now wants a do-over, sending a chilling warning to American business that no sale is ever final,” Newstead said.

She also raised doubts about alleged harms caused by Facebook arguing that consumers benefited from the decisions to make WhatsApp free.

In a post on Facebook’s internal discussion platform, Chief Executive Mark Zuckerberg told employees he did not anticipate “any impact on individual teams or roles” as a result of the lawsuits, which he said were “one step in a process which could take years to play out in its entirety.”

Comments were turned off for Zuckerberg’s post, as well as for other posts on the lawsuits shared by Newstead and Chief Privacy Officer for Product Michel Protti, according to copies viewed by Reuters. Newstead also warned employees not to post about the cases.

Facebook did not immediately respond to questions about the posts.

Zuckerberg also told employees in July that the company would “go to the mat” in order to fight a legal challenge aimed at braking up the company which he called ”existential” threat according to an internal meetings which The Verge got a hold of.

Antitrust experts believes that the case was unusually strong considering the statements made by the company’s CEO which was gotten from the company’s own documents such as the 2008 email in which Zuckerberg said “It is better to buy than compete.”

Other experts such as Seth Bloom of Bloom Strategic Counsel said the FTC complaint was “significantly weaker” than the DOJ’s lawsuit against Google.

“We’re talking about acquisitions that are six or eight years old and it will be difficult for a court to order divestitures of many years ago,” Bloom said.

Investors echoed similar concerns.

“I do not know if the FTC or DOJ will be successful in breaking Facebook up. I’m assuming this will be dragged out in the courts as FB defends itself,” said Daniel Morgan, a portfolio manager at Synovus Trust in Atlanta, Georgia.

This lawsuit is the biggest antitrust suit against a big tech company in a long time with the previous being against Microsoft Corp back in 1998 and the case was settled but the legal battle prevented the company from thwarting competitors and is credited with clearing the way for the explosive growth of the internet.

Last month, Facebook said it was buying customer service start-up Kustomer, in an acquisition that the Wall Street Journal said valued Kustomer at $1 billion.

And do not forget another big purchase Facebook made when it purchased the Image and GIF sharing service Giphy back in May but the acquisition further brought scrutiny from the UK’s competition watchdog.

Facebook shares fell as much as 3% after the news before paring losses to close down 1.9%.

Source: Reuters
Tags: Facebook
DreamHost
ADVERTISEMENT

Related Posts

Industry News

Screenshots of Facebook’s upcoming audio chatroom that will rival Clubhouse leaked

by Ret SILO

The success of the audio-only social network service Clubhouse drew the attention of Facebook and the company wants to take advantage of its billions to build the system into its...

Read more
A Facebook logo is seen on a smartphone in this photo illustration on November 15, 2017. (Photo by Jaap Arriens/NurPhoto)
Industry News

Facebook making neural wearable device that work with its Smart AR Glasses

by Sam Curtis

Facebook will be announcing its pair of smart glasses later on this year and the company is reportedly working on a wearable device to accompany the AR smart glasses. The...

Read more
Companies halting their Facebook Advertisement
Culture

Facebook released an ad campaign to convince iPhone users to enable ad tracking

by Ret SILO

The social network giant portrayed itself as the Good Guy that has helped numerous small businesses thrive through personalized ads

Read more
Zuckbuck
Culture

Facebook needs to make more billions and wants you to allow it

by Ret SILO

The company uses it's user's data to retarget them with ads

Read more
Culture

Facebook suspends IPOB Leader Kanu Nnamdi’s account over “Hate Speech”

by Biola Kay

The separatist is known in the country for his controversial rhetoric and his believe that the IPOB should become an independent country

Read more
Culture

Signal Finally Back Online After Server Outage

by Eva Derika

The IM had seen a sudden spike in its user base after Elon Musk tweeted support for it.

Read more
Leave Comment

TOP BARGAINS

The Bargainer

AllDoCube iPlay 40 UNNISOC T618 With 8GB of RAM and 128GB of Storage just got cheaper

The Bargainer

Enjoy a Massive discount for these BlitzWolf® over-ear Gaming Headphones

The Bargainer

This BlitzWolf® BW-FUN3 Wi-Fi Essential Oil Diffuser is offered with 40% off

The Bargainer

Save $70-$130 On Select Samsung Galaxy Tablets on Best Buy

The Bargainer

Save 45% on the Deerma DX700S 2-in-1 vacuum cleaner

BRUMPOST DAILY

Get caught up in minutes with our speedy summary of today’s tech happenings!
SUBSCRIBE

BEST HOLIDAY DEALS

BEST HOLIDAY DEALS

It’s holiday season and on Brumpost Bargainers, we actually get you the best values and amazing deals by scouring the entire web for the most affordable yet high quality products ever for you.

Learn more
  • About us
  • Advertise
  • Mobile
  • Write for us
  • FAQ
  • Cookie Policy
  • Contact us
  • Career
  • Terms of Use
Menu
  • About us
  • Advertise
  • Mobile
  • Write for us
  • FAQ
  • Cookie Policy
  • Contact us
  • Career
  • Terms of Use
© 2020 BRUMPOST MEDIA LLC
All Rights Reserved
FOLLOW US
AFFILIATE DISCLOSURE
Brumpost may get a commission from retail offers.
  • Login
  • Sign Up
No Result
View All Result
  • Tech News
    • Industry News
    • Gears & Gadgets
    • Sci-Tech
    • Culture
    • Enterprise
    • Rumors
  • Products Review
    • Smartphones
    • Smartwatches
    • Bluetooth Speakers
    • Headphones
    • PC & Computers
  • “How-to” Guide
    • Apps/Software
    • BP-Hack
    • Gadgets
    • Internet
  • Tirepost
    • Best Cars
    • Car Reviews
    • Latest News
  • @Work
  • The Bargainer
    • under $50
    • Under $100
    • Under $200
    • Under 300
    • under $400
    • Under $500
  • Videos
  • Pictures
  • COVID-19 Monitor

©Copyright 2018 Brumpost Media, Inc.

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

*By registering into our website, you agree to the Terms & Conditions and Privacy Policy.
All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
DON’T MISS OUT AGAIN!
GET THE LATEST UPDATES IN YOUR INBOX EVERYDAY
FREE SIGN UP
By signing up, you agree to BRUMPOST Terms of Use and acknowledge the data practices in our Privacy Policy. You may unsubscribe at any time.
Learn how to grow every aspect of your
GET THE BEST SMALL BUSINESS RESOURCES & TIPS DAILY
FREE SIGN UP
By signing up, you agree to BRUMPOST Terms of Use and acknowledge the data practices in our Privacy Policy. You may unsubscribe at any time.
GO
Sign-up for exclusive content. Be the first to hear about Brumpost Tech news.
Subscribe
close-image

astronaut astronomy cosmonaut galaxy RECENT VIDEOS play_circle_outline Watch NASA's Next Spacewalk on Saturday March 13th Apple iPhone 12 Pro Max leaked in a new video RECENT VIDEOS play_circle_outline Alleged iPhone 12 Pro Max leaked video showed some interesting features Zack Snyder's Justice League trailer RECENT VIDEOS play_circle_outline This is the first trailer for the Zack Snyder's Justice League Galaxy Fold 2 RECENT VIDEOS play_circle_outline Galaxy Fold 2 appears in a teaser hinting possible release things to consider before buying a smartphone RECENT VIDEOS play_circle_outline Top 8 things to consider before buying a smartphone in 2020
close-link

WE'VE GOT BUNCH OF COOKIES HERE!

Brumpost uses cookies to enhance your experience and by continuing to use the website, you are giving consent to those cookies being used. To learn more, click below
COOKIE POLICY
close-link
Click Me

Get caught up in minutes with our speedy summary of today’s tech happenings!
SUBSCRIBE