A class-action lawsuit was filed Friday in the US District Court for the Northern District of California against Facebook, alleging that the social media giant engaged in anticompetitive behavior and exploited user data through deceptive practices.
The lawsuit named two plaintiffs, Sarah Grabert and Maximilian Klein, who claim that Facebook has lied about its data collection practices. The complaint explains that the plaintiffs lost trust in Facebook to protect their privacy after the Cambridge Analytica exposure in 2018. Overall, the complaint claims:
Facebook exploited the rich data it deceptively extracted from its users to identify nascent competitors and then “acquire, copy, or kill” these firms. Rather than competing on the merits, Facebook used the valuable consumer data that it was harvesting to identify incipient competitors with the most likely path to meaningful market share gains. . . Facebook’s weaponization of user data and its strategy to “acquire, copy, or kill” competitors has been wildly successful at the expense of consumers. Facebook’s anticompetitive scheme has lessened, if not eliminated, competition and harmed consumers.
The complaint identifies two separate markets where Facebook allegedly sought to obtain monopoly power: the social network market and the social media market. The complaint further identifies Facebook’s primary suite of offerings as Facebook, Instagram, Facebook Messenger, WhatsApp, and Oculus. The complaint maintains that Facebook sought monopolization of the social media market and social network market, and attempted monopolization of the social network market and social media market in violation of the Sherman Antitrust Act. In addition, the complaint asserts a claim of unjust enrichment.
Overall, the complaint asks for injunctive and equitable remedies, including: (1) an order barring Facebook from engaging in wrongful behavior; (2) requiring Facebook to seek third-party auditors to evaluate Facebook’s practices; and (3) requiring Facebook to divest assets, like WhatsApp, that substantially establish Facebook’s monopoly power.