New York Attorney General Leticia James (D.) today said she was leading a multi-state investigation into Facebook, Inc., for possible antitrust violations.
“I’m launching an investigation into Facebook to determine whether their actions endangered consumer data, reduced the quality of consumers’ choices, or increased the price of advertising,” AG James tweeted today.
The investigation, she said, “focuses on Facebook’s dominance in the industry and the potential anticompetitive conduct stemming from that dominance.”
“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. 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,” AG James said in a statement.
AG James said the attorneys general of Colorado, Florida, Iowa, Nebraska, North Carolina, Ohio, Tennessee, and the District of Columbia were also participating in the investigation.
Facebook said in a statement today that it would cooperate with the attorneys general.
“People have multiple choices for every one of the services we provide. We understand that if we stop innovating, people can easily leave our platform. This underscores the competition we face, not only in the U.S. but around the globe. We will work constructively with state attorneys general, and we welcome a conversation with policy-makers about the competitive environment in which we operate,” said Will Castleberry, Facebook’s vice president-state and local policy.
Facebook previously announced in its quarterly filing with the Securities and Exchange Commission that it was the subject of an antitrust investigation by the FTC (07/24/19).
“The online technology industry and our company have received increased regulatory scrutiny in the past quarter. In June 2019, we were informed by the FTC that it had opened an antitrust investigation of our company,” it said. Facebook had also noted in July that the Department of Justice “announced that it will begin an antitrust review of market-leading online platforms.”
In a statement today, the Competitive Enterprise Institute said the actions being taken by the attorneys general were harmful to consumers.
“These state attorneys general are expanding the power of their office and stretching the limits of what constitutes an antitrust violation,” said Jessica Melugin, associate director of CEI’s Center for Technology and Innovation.
“This sort of high-profile activism may benefit state AGs’ political ambitions, but impose harmful costs on consumers, businesses, and the economy,” she said. “The mere threat of legal penalties -- and the environment of over-caution it engenders -- also has a chilling effect on entrepreneurs. Such opportunity costs are impossible to measure.” —Carrie DeLeon, [email protected]wer.com
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