New York AG’s Meta Antitrust Suit Dismissed by Appeals Court

New York and other state attorneys general waited too long to sue Meta Platforms Inc. over its acquisitions of Instagram and WhatsApp, a federal appeals court ruled, upholding the dismissal of their antitrust suit.

“The states were on notice of Facebook’s two major acquisitions. Both were publicized,” a three-judge panel on the US Court of Appeals for the DC Circuit wrote Thursday. We “agree with the district court that the States unduly delayed in bringing suit.”

Meta said it will continue to vigorously defend itself against a related antitrust lawsuit by the Federal Trade Commission.

“This case fundamentally mischaracterized the vibrant competitive ecosystem in which we operate” Meta spokesperson Stephen Peters said. “In affirming the dismissal of this case, the court noted that this enforcement action was ‘odd’ because we compete in an industry that is experiencing ‘rapid growth and innovation with no end in sight.’”

The New York attorney general’s office didn’t immediately respond to requests for comment.

Attorneys general from 48 US states and territories, led by New York, sued Meta in December 2020, alleging the company monopolized the social networking market through a scheme to “buy or bury” its rivals. The FTC filed its own, nearly identical suit at the same time.

Both cases alleged that Meta acquired photo-sharing app Instagram in 2012 and messaging platform WhatsApp in 2014 to keep them from growing into competitors and that the company selectively enforced its policies to cut off rivals’ access to user data.

Judge James Boasberg, who is hearing both cases, dismissed the states’ case in June 2021 on the grounds that they had waited too long to sue. That legal doctrine, known as laches, doesn’t apply to the federal government, and the states appealed, arguing it shouldn’t apply to their case either.

Boasberg’s decision also threw out allegations in both the state and FTC cases that related to Facebook’s policies with regard to competitors. The DC Circuit affirmed that part of his ruling as well, saying that Facebook had no legal obligation to do business with its competitors. The company ended that policy in 2018.

“It makes no sense to require Facebook to foreswear a policy that ended in 2018, or to provide Facebook Platform access to a handful of companies which are either defunct or have changed their business model ever since Facebook banned them,” the court said.

While the FTC’s suit against Meta remains pending, a trial date hasn’t yet been set.

(Updates with Meta comment in third paragraph)

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Leah Nylen in Washington at lnylen2@bloomberg.net

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Sara Forden at sforden@bloomberg.net

Leah Nylen

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