Facebook faces multistate investigation for possible antitrust violations

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The New York Attorney General’s office confirmed Friday it is leading a multistate investigation into social media giant Facebook for potential antitrust issues.

Joining in the multistate investigation of Facebook, thus far, are attorneys general from Colorado, Florida, Iowa, Nebraska, North Carolina, Ohio, Tennessee, and the District of Columbia. “The investigation focuses on Facebook’s dominance in the industry and the potential anti-competitive conduct stemming from that dominance,” according to the New York Attorney General’s office.

“Even the largest social media platform in the world must follow the law and respect consumers. I am proud to be leading a bipartisan coalition of attorneys general in investigating whether Facebook has stifled competition and put users at risk,” said New York Attorney General Letitia James. “We will use every investigative tool at our disposal to determine whether Facebook’s actions may have endangered consumer data, reduced the quality of consumers’ choices, or increased the price of advertising.”

There are also reports that about three dozen attorneys general, led by Texas Attorney General Ken Paxton, will be announcing a similar antitrust investigation into Alphabet. The attorneys general reportedly are investigating what impact Google has on digital advertising markets and the potential harm to consumers from their information and ad choices being concentrated in one company, according to the Wall Street Journal.

Both investigations come at a time when the Department of Justice’s Antitrust Division is closely reviewing “whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers,” the agency said. Specifically, the review will consider the widespread concerns that consumers, businesses, and entrepreneurs have expressed about search, social media, and some retail services online, the agency said.

“Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands,” said Assistant Attorney General Makan Delrahim of the Antitrust Division. “The Department’s antitrust review will explore these important issues.”

In July 2019, the Federal Trade Commission hit Facebook with a groundbreaking $5 billion penalty for privacy violations and imposed unprecedented new privacy and corporate governance obligations onto Facebook that it must implement.

The FTC is also investigating Facebook over antitrust concerns, the company announced in a second-quarter filing.

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