Missouri Attorney General Eric Schmitt has joined a lawsuit with 48 other states against Facebook, alleging that the social media giant has chilled innovation, deterred investment, and forestalled competition in the markets in which it operates.
“I've disagreed with the Attorney General on a few things but the vast majority of states and their attorneys general have signed on to this lawsuit, which I think is important because we need to start enforcing antitrust laws in Missouri and throughout the nation,” former Attorney General candidate Elad Gross said. “It’s a lawsuit that is certainly warranted.”
According to the Dec. 9 complaint, Facebook has monitored and purchased apps it perceived may be a threat and sometimes snatched them from other firms in whose grip they may have potentially flourished and become challengers to Facebook.
“There are practices where Facebook has really been trying to corner the market, whether that'd be on social media, communication, or certain types of advertisements,” Gross added. “The way Facebook is buying other companies and consolidating can create an anti-competitive system.”
The lawsuit was filed on behalf of millions of consumers and small businesses who have allegedly been harmed by Facebook’s predatory behavior, according to media reports.
“We allege that Facebook has stifled competition to protect its monopoly power, reduced choices for consumers, shut down innovation, and weakened privacy protections for millions of Americans,” Schmitt said.
The complaint further claims that consumers often use Facebook to announce news to their families and friends, which provides the social media platform with unique opportunities to gather information about birthdays, marriages, deaths, graduations, and other personal milestones.
“There are a lot of issues with Facebook when it comes to privacy and how our data is being kept and whether people are being made aware of how that information is being used,” Gross told the St. Louis Record. “There has been some talk of compensating people for the use of that data but we just don't even really know what's going on with it.”
The lawsuit, launched by New York Attorney General Letitia James, demands that Facebook’s acquisition of Instagram and Whatsapp be decreed a violation of the Clayton Act and that each Plaintiff State be awarded its costs, including reasonable attorneys’ fees. The Clayton Act is antitrust legislation that was approved by the U.S. Congress in 1914.
“Anti-competitive practices prevent Missourians with small businesses and other places in the United States from starting their own companies and being able to enter that market space because the barriers are so high for them to enter and there's almost no way for you to be able to compete on a fair footing with a Facebook, for example, in this situation or some other kind of a monopoly in this space,” Gross said.