A group of US states led by New York and the Justice Department is trying to reinstate an antitrust suit against Meta for anti-competitive behavior.

They have approached a federal appeals court arguing that a lower court made a mistake in its decision they waited too long to sue.

New York Solicitor General Barbara D. Underwood said the Facebook-parent company faced no harm from the state attorneys general’s suit as it is already facing one from the Federal Trade Commission.

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Underwood gave her statements before a three-judge panel of the US Court of Appeals for the District of Columbia Circuit.

She said: “There was no harm to Facebook from the states suing in 2020 rather than a few years earlier. The delay was not unreasonable.”

However, Meta attorney Aaron M. Panner believes the lower court was correct to reject the states’ antitrust lawsuit.

He said: “This conduct occurred years ago. The states’ claims were stale.”

Meta was sued in December 2020 by attorneys general from 48 US states and territories, led by New York.

They said the firm monopolized the social networking market through a scheme to “buy or bury” its competitors.

At the same time, the FTC filed a nearly identical lawsuit.

Both complaints alleged that Meta purchased the photo-sharing app Instagram in 2012 and the messaging app WhatsApp in 2014 to stop them from becoming rivals.

The lawsuits also claim that the business selectively enforced its regulations in order to block rivals’ access to user data.

Both claims are being heard by Judge James Boasberg, who rejected the states’ complaint in June 2021 on the grounds that they had waited too long to sue.

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That legal doctrine, known as laches, does not apply to the federal government, and the states argued that it should not apply to their case.

The Justice Department agreed with Underwood that the states’ lawsuit should be restored.

Underwood said: “The anticompetitive character of the acquisitions was not immediately apparent” at the time. 

She also said Meta misled authorities about what it planned to do with WhatsApp.

The firm’s unlawful practice was not exposed until December 2018, when the UK Parliament disclosed internal corporate records concerning how Facebook dealt with competitors.

However, Meta’s Panner stated that the deals were “highly publicized” and insisted the states should have acted earlier.

He said: “All of this conduct was quite open and public at the time. Laches exists to prevent that kind of unfair delay.”

He said the states are suing on behalf of their citizens, who they claim were affected by Meta’s actions.

Judge A. Raymond Randolph asked Panner about news reports that Facebook is losing users to other apps.

Panner said: “This is a dynamic market in which there is substantial entry.”

He mentioned ByteDance’s TikTok, Alphabet’s YouTube, and Snap as Meta’s main rivals.

After the hearing, Meta spokesman Christopher Sgro stated that the firm believes the lower court verdict should stand.

Source: Bloomberg

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