A U.S. district judge in Washington ruled that Facebook parent Meta Platforms did not violate antitrust laws with its acquisitions of photo-sharing app Instagram and messaging service WhatsApp more than a decade ago.
The decision marks a defeat for the Federal Trade Commission, the US antitrust watchdog, which sued Meta in 2020 alleging that the company secured a monopoly on social media by buying up rivals.
“The Court ultimately concludes that the agency has failed to meet its burden: Meta has no monopoly in the relevant market,” Judge James Boasberg wrote Tuesday.
The company praised the decision in a statement provided to the BBC, saying it “recognizes that Meta faces fierce competition.”
In April, Judge Boasberg presided over a lengthy trial that featured testimony from Meta CEO Mark Zuckerberg and former COO Sheryl Sandberg, who argued that TikTok and YouTube had shaken up the social media landscape.
In his decision, Judge Boasberg noted that the FTC reviewed and approved Meta’s 2012 acquisition of Instagram and its 2014 acquisition of WhatsApp.
The agency had argued that the company overpaid when it bought Instagram for $1 billion and WhatsApp for $19 billion.
Judge Boasberg described an ever-changing social media landscape, “with apps coming and going, chasing one fad and leaving others behind, and adding new features with each passing year.
Even if Meta enjoyed monopoly power in the past, he said the FTC failed to show “that it continues to have that power now,” as Meta’s market share “appears to be shrinking.”
In a statement to the BBC, the FTC indicated it was unsure whether it plans to appeal.
“We are deeply disappointed by this decision,” said FTC Public Affairs Director Joe Simonson, adding that the agency was reviewing all of its options.
Simonson also told the BBC that “Judge Boasberg was always against us,” who has clashed with the Trump administration several times and faces an effort by congressional Republicans to impeach him.
The BBC has asked Judge Boasberg for comment.
With its victory on Tuesday, Meta avoids a possible spin-off of the company that could have included the split of Instagram and WhatsApp.
“Our products are beneficial to people and businesses and exemplify innovation and economic growth in the United States,” a Meta spokesperson told the BBC on Tuesday. “We look forward to continuing to partner with the Administration and invest in the United States.”
The decision comes after the Justice Department won two previous antitrust cases against Google: one alleging a monopoly in online search and the other in advertising technology.
But earlier this year, another district judge in Washington presiding over the online search case refused to force Google to spin off its Chrome browser, a step the Justice Department had suggested was necessary to end the tech giant’s search monopoly.
In that context, Tuesday’s ruling against the FTC “looks like a change of momentum,” said Rebecca Haw Allensworth, a professor of antitrust law at Vanderbilt Law School.
“I think that will influence the likelihood of more cases like this occurring.”
But, Allensworth added, the ruling does not indicate that the government’s efforts to crack down on antitrust behavior are failing.
“It’s a mix of things,” he said.
Many legal observers say the FTC’s case against Meta was challenging from the start.
The case “was always difficult, particularly given the rapidity with which we have seen changes in the social media market in recent years,” said Laura Phillips-Sawyer, a professor at the University of Georgia School of Law.
Still, he said, the case revealed “a series of statements by Zuckerberg at the time of those acquisitions that seemed like a desire to quell an incipient threat to Facebook’s dominance.”
Meta’s legal entanglements are not over.
Zuckerberg has been ordered to testify in a landmark trial about the impact of social media on young people.
Last month, Los Angeles County Superior Court Judge Carolyn Kuhl rejected Meta’s argument that an in-person appearance in January was unnecessary.
Instagram chief Adam Mosseri will also testify at the trial, which arises from allegations that Meta and other social media companies make their apps addictive to young people despite being aware of the mental health risks.
