Facebook Users Petition Court To Revive Antitrust Claims

Meta Platforms' users have asked a federal appellate court to reinstate claims that Facebook monopolized a market for “personal social network services."

U.S. District Court Judge James Donato in the Northern District of California dismissed the users' lawsuit last year, ruling that they hadn't proven they were harmed by the company's alleged monopoly.

The users argue in papers filed Thursday with the 9th Circuit Court of Appeals that they should have been allowed to argue to a jury that Meta monopolized the “personal social network services" market, and that this alleged monopoly enabled the company to collect users' data without compensating them.

The appeal comes in a battle dating to 2020, when Vermont resident Maximilian Klein and Illinois resident Sarah Grabert sued the tech company over alleged antitrust violations.

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The duo -- later joined by Minnesota resident Rachel Banks Kupcho -- claimed that Facebook grew in popularity after allegedly deceiving consumers about its privacy policy, then “weaponized” consumer data in order to acquire potential rivals like social media service Instagram (acquired for $1 billion in 2012) and messaging service WhatsApp (bought for $19 billion in 2014).

The plaintiffs contended that if Meta hadn't obtained a monopoly, it would have had to pay users $5 per month for their personal data. That dollar figure came from economist Nichola Economides, who the plaintiffs wanted to present as an expert witness.

Donato ruled that Econonides's opinion wasn't supported by the record, and dismissed the lawsuit on that basis. He wrote that without Economides' testimony, the plaintiffs couldn't prove that they suffered any sort of harm from Meta's alleged monopolization.

"The exclusion of Dr. Economides’ injury opinions guts plaintiffs’ case," he wrote, adding: "Meta has demonstrated that plaintiffs cannot prove the essential element of antitrust injury at trial."

Counsel for the plaintiffs is asking the 9th Circuit to reverse that ruling, arguing that it should have been able to present Economides' testimony to a jury.

"Here, reasonable jurors could side with Economides’ view of the evidence, even if Meta’s expert ... and the district court disagreed with it," counsel argues to the 9th Circuit.

The Federal Trade Commission separately brought an unsuccessful suit against Meta over its acquisitions of Instagram and Whatsapp. U.S. District Court Judge James Boasberg in Washington, D.C. threw out the case last year, ruling that the agency failed to prove Meta monopolized a market for "personal social networking services."

Instead, Boasberg ruled, Meta competes with YouTube and TikTok for social media users. The FTC is appealing that decision.

Counsel for the users argue in the appellate brief that Boasberg's ruling is not binding on the 9th Circuit.

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