Here are the antitrust arguments against Facebook and why a judge dismissed them.

A federal judge on Monday overturned arguments in two antitrust cases against Facebook, one filed by the Federal Trade Commission and the other by attorneys general from 46 states and the District of Columbia and Guam.

The judge, James E. Boasberg of the US District Court for the District of Columbia, said the federal government had not claimed that Facebook has a monopoly on social networks. And he said the states had waited too long to bring their case.

Here are the prosecutors’ arguments and the judges’ response:

The argument

The Federal Trade Commission said: that Facebook has maintained its monopoly by buying companies that pose competitive threats and by imposing restrictive policies that unjustifiably hinder actual or potential rivals that Facebook cannot or cannot acquire. Facebook gained monopoly power after toppling early rival Myspace, the agency said, and has become the largest and most profitable social network in the world.

The opinion

Judge Boasberg said: that the committee had not sufficiently proved that Facebook was a monopoly and that the definition of the social media agencies was too vague.

The FTC’s complaint says almost nothing concrete about the key question of how much power Facebook actually had, and still has, Judge Boasberg wrote. It’s almost as if the agency expects the court to simply nod to the conventional wisdom that Facebook is a monopolist. After all, no one who hears the title of the 2010 movie The Social Network wonders what company it is about.

But whatever it may mean to the public, monopoly power is an art term under federal law with a precise economic meaning: the power to profitably raise prices or foreclose competition in a well-defined market. Simply claiming that a Defendant firm has a share of more than 60 percent in an unusual, unintuitive product market whose boundaries are only slightly worked out and the players within which remain almost completely unspecified is not enough.

The argument

The committee also alleged that Facebook maintained its dominance by threatening to ban software developers from accessing the social network if they created competing products. It also argued that while Facebook had reversed a policy that allowed it to shut down standalone apps that replicated its functions, Facebook is likely to reintroduce such a policy if such an investigation succeeds.

The opinion

A monopolist has no obligation to do business with its competitors, and a refusal to do so is generally lawful, Judge Boasberg wrote:. In order to take action, such a plan must include specific instances where that policy was enforced (i) against a rival with whom the monopolist had previously dealt with; (ii) while the monopolist continued to do business with others in the market; (iii) with a short-term loss of profit, for no reason other than to bankrupt a competitor in the long run.

In addition, there are no facts to indicate that the antitrust investigation facing the company is about to pass or even succeed in the foreseeable future. Indeed, a quick glance at a newspaper yields the opposite conclusion.

The argument

Facebook has linked its acquisition strategy with foreclosure tactics that eradicate competitive threats, the states said in their lawsuit, sending the message to tech companies that, in the words of one participant, if you trod Facebook or resist the pressure to sell, Zuckerberg would go into destruction mode and subject your company to the wrath of Mark. In addition to Facebook CEO Mark Zuckerberg, the states specifically referred to the company’s purchases of Instagram in 2012 and WhatsApp in 2014.

The opinion

Judge Boasberg noted: that the lawsuit generally seeking to have Facebook divest one or both companies was not filed until December 2020. a resulting remedy has been accepted in a case brought by a plaintiff other than the federal government.