Facebook's value soars to $1 trillion after huge legal decision
Washington DC - Shares of social networking giant Facebook Inc (FB) gained over 4% on Monday after a federal judge dismissed anti-trust lawsuit filed against the company.
District Judge James Boasberg has dismissed the complaints filed last year by the Federal Trade Commission (FTC) and state attorneys general led by New York's Letitia James.
The complaint sought to break Facebook's alleged monopoly in social networking, which could have resulted in the company being forced to divest itself of Instagram and WhatsApp.
The complaint claimed that Facebook violated antitrust laws by buying photo-sharing app Instagram and messaging service WhatsApp to eliminate any competition and continue its monopoly.
However, in the filing, the court states that the FTC did not prove Facebook controls over 60% of the market – a monopoly.
"Although the Court does not agree with all of Facebook's contentions here, it ultimately concurs that the agency's Complaint is legally insufficient and must therefore be dismissed," reads the filing from District Court for the District of Columbia.
"The FTC has failed to plead enough facts to plausibly establish a necessary element of all of its Section 2 claims - namely, that Facebook has monopoly power in the market for Personal Social Networking (PSN) Services."
Market reacts to decision
Facebook, which was founded by Mark Zuckerberg in his dorm room in 2004, has recently found itself under siege by American regulators and politicians, who want to keep the company under a tight rein.
The platform boasts of nearly 2.85 billion monthly active users as of the first quarter of 2021, while Instagram has nearly 1.074 billion users worldwide and WhatsApp is reported to have more than two billion monthly active users globally.
"The Court agrees that the first – the possession of monopoly power in the market for Personal Social Networking Services (as defined by the agency) – is not adequately pleaded here," the filing reads. "No more is needed to conclude that the Complaint must be dismissed."
The FTC has until July 29 to file an amended complaint. Following the ruling, the social media giant's market cap breached the $1 trillion milestone for the first time.
Cover photo: 123rf/Panithan Fakseemuang