News & Insights 2 old
FTC Files Upgraded Facebook Antitrust Complaint Looking to Overturn Court Dismissal
Report from the Wall Street Journal
In Brief – The Federal Trade Commission has filed a bolstered version of its antitrust case against Facebook in hopes of turning around Judge James Boasberg’s dismissal of the agency’s original lawsuit. Boasberg created a stir in June by granting Facebook motions to dismiss against both the FTC and State AG antitrust complaints. Each accused the digital giant of being a monopoly that illegally acquired Instagram and WhatsApp and sought to unwind the acquisitions. The judge fully rejected the State AGs authority to challenge the acquisitions so many years later and severely criticized the FTC complaint for lacking substance. In the new complaint, the FTC argues that Facebook is a “personal social networking” company, that it’s largest competitor is Snapchat, and giant platforms like TikTok, YouTube, LinkedIn, Twitter and Pinterest operate in different markets. The complaint includes much data backing the case that Facebook has held at least an 80% share of user attention for personal social networking services since 2012.
Context – The dismissals of the two major complaints filed by U.S. antitrust enforcers against Facebook surprised nearly all observers. The revised complaint from the FTC, now led by noted Big Tech critic Lina Khan, who’s participation was challenged by Facebook for bias, has been portrayed as a major test of her leadership. Most observers think the new case is likely to pass the initial hurdle this time. And like many antitrust cases, defining the market is key to this legal fight. If “the relevant market” is “personal social networking,” which seems to read as being social media services designed like Facebook, then Facebook is dominant and the case flows from there. Facebook argues that they are actually a two-sided digital advertising business that competes with all those other giant social media platforms for user attention on one side and advertiser business on the other. And that they are not remotely a monopoly or dominant in that market. By the way, the State AGs are appealing their outright dismissal as well.
CA Judge Overturns Gig Platform Prop 22 Creating Uncertainty Over AB 5 and Ridesharing
Report from the Los Angeles Times
In Brief – A California Superior Court Judge has ruled that Prop. 22, the ballot initiative enacted in November 2020 to exempt “Gig work” ridesharing and delivery companies from California’s AB 5 legislation, violates the state’s constitution and therefore is not valid. AB 5, enacted in 2019, was a top labor movement priority aiming to require businesses to classify most independent contract workers, in particular on digital Gig work platforms, as employees. Prop. 22, a ballot initiative to exempt ridesharing and delivery platforms from AB 5 and severely restrict the right of the state legislature to go back and reimpose employee-type mandates on the platforms, was passed with 58% of the vote. Judge Frank Roesch’s ruling contends that the ballot initiative unconstitutionally limited the right of future legislatures to define the employment status of Gig workers as well as being over broad by covering more than one topic. The largest ridesharing and delivery platforms, including Uber, Lyft and Instacart, who were major funders of Prop. 22, have indicated that they will appeal the ruling and resolution of the case is likely to take more than a year.
Context – Between AB 5 and Prop. 22, California has been at the center of the debate over how independent work should be regulated in the digital age, at least in the United States. AB 5 threatened a wide range of independent contractors and freelancers, such as writers and musicians, and the state’s legislature doubled back in mid-2020 and exempted a wide variety of independent workers. Voters then exempted the ride sharing and delivery platforms entirely from the law with Prop. 22. While it seemed that other states, most recently Massachusetts, or the Department of Labor, would become the new hub of Gig work political battles in the US, maybe California will again press to be the center of attention. Finally, much more is actually happening in Europe, for example with Spain mandating platform delivery drivers be employees and the UK Supreme Court requiring Uber drivers to be company workers.
Proposed Apple Settlement with Small App Developers to Modify Payments Policy
Report from the Wall Street Journal
In Brief – Apple has reached a proposed legal settlement with a group of smaller app developers that will allow developers to inform customers that they can pay for digital services outside of their iPhone apps and receive the services on their phone, allowing the developers to more often avoid the Apple payments service that is currently used by Apple to collect its 30% commission. Communication between the developers and their customers about payment alternatives would be allowed through email and other channels, but not inside the iOS apps themselves. Apple also has also agreed to maintain for three years its 15% commission on smaller app developers instituted last fall and set aside $100 million to pay small developers. The agreement would settle a different suit than the high-profile antitrust clash between multi-billion-dollar game developer Epic Games and Apple but the same federal judge is handling both cases and must now approve this settlement.
Context – The much-anticipated decision from Judge Yvonne Gonzalez Rogers in the Epic v. Apple trial remains the headline event in this space. Apple’s proposed settlement with the smaller developers indicates that they clearly took heed of critical comments made by the judge about Apple restricting communications between developers and their customers about cheaper payments options. EU Commissioner Margrethe Vestager also raised the issue in the context of the European Commission competition case targeting Apple. During the Epic v Apple trial, Apple representatives noted that offline vendors cannot advertise in a retail store that other retailers offer lower prices. This settlement seems to heed that distinction with Apple stepping back from attempting to restrict developer communications outside of Apple’s “store”. The Coalition for App Fairness, an advocacy group funded by large developers including Epic, harshly criticized the proposal as a “sham settlement” indicating that Epic is looking for far more than the same offer.
Federal Court Panel Moves Google AdTech Antitrust Suits to the Southern District of NY
Report from Reuters
In Brief – A collection of 19 antitrust suits targeting Google’s advertising businesses have been consolidated in federal court in the Southern District of New York by the U.S. Judicial Panel for Multidistrict Litigation (JPML). The judicial panel determined that the cases shared a “common factual core” and tasked District Judge Kevin Castel with sorting out a range of questions common to all the cases, such as defining the relevant market, competitors, and the design, operation and potentially anticompetitive effects of Google’s AdTech services and conduct. The most high-profile case impacted is the antitrust suit brought by 15 State Attorneys General led by the State of Texas. Texas’s AG has argued that the AGs’ case should proceed in federal court in the Eastern District of Texas and fought Google’s effort to move the suit to the Northern District of California where a number of the other AdTech cases brought by advertisers and publishers were filed. The JPML selected the Southern District of New York, which includes New York City, due in part to the strong presence of the advertising and publishing industry, a point raised with the panel by Facebook, which is also implicated in the cases due to business dealings with Google.
Context – US antitrust enforcers have filed four suits targeting Google. Three are from State AGs, dealing with advertising, search and the Play Store. A DoJ-led suit also focuses on search. While three of the four have been filed in Federal District Court in the District of Columbia, Texas AG Ken Paxton filed the advertising-focused suit in the Eastern District of Texas. In May, he prevailed over Google’s attempt to move the case to California. Legislation to exempt all antitrust cases brought by State AGs from federal court consolidation, just as federal antitrust cases are exempt, and giving State AGs a sort of “home field advantage” over companies, has significant bipartisan support on Capitol Hill. This JPML decision only covers pre-trial activity in the AdTech cases and the AGs’ case could be moved for trial.
Uber Working with Moove to Finance New Cars for Fleet of Uber Drivers in Africa
Report from TechCrunch
In Brief – Moove, a Netherlands-based startup founded by British-born Nigerian entrepreneurs, has become Uber’s exclusive partner in sub-Saharan Africa for vehicle financing and supply, and announced that it has raised $23 million to fund new car purchases in Africa by drivers who provide services through the Uber app on the continent. The company is competing against fast growing auto financing firms like Autochek in Nigeria and FlexClub in South Africa. The partnership with Uber is a key differentiator, linking new car purchases to money-making work. In announcing the partnership, Uber noted that Moove vehicles will come with a standard COVID safety tool kit, mandatory monthly car servicing and inspections, and a commitment that 50% of drivers are women to address long-standing issues with a lack of inclusion in the transportation sector. By linking car purchasing to operating on the ride sharing platform, Moove claims to be able to offer loans with meaningfully better terms than the traditional financing market.
Context – The Uber tie-up with Moove to fund a fleet of new-car outfitted Uber drivers in Africa is reminiscent of Amazon’s program initiated in 2018 to support the purchase of Amazon-style delivery vehicles by thousands of small entrepreneurs to build a fleet of Gig economy Amazon delivery providers. Gig platform models, where the platform company directs the provision of a service while having the work done by “independent” third parties, can rapidly scale because many of the investments related to labor, infrastructure and equipment is paid by the third parties. A key legal and policy question is the degree of control the platform exerts on the third-party providers, especially when a platform appears to be attempting to run a traditional business while shifting liability costs, or worker costs, over to third-party users who are not actually “independent”. For example, drivers for Amazon’s Gig delivery providers say they are routinely pressed to skip Amazon’s official worker and driving safety protocols.
Supreme Court OKs the Indian Competition Authority Investigation of Amazon and Flipkart
Report from Reuters
In Brief – The Indian Supreme Court has rejected the appeals of Amazon and Flipkart, the US-based leaders in the country’s ecommerce market, and allowed the Competition Commission of India’s (CCI) to continue its investigation into business practices of both firms that many allege violate the country’s competition and foreign direct investment (FDI) laws. The CCI initiated the investigation in early 2020 following years of charges that both firms invested in and promoted a small number of very large domestic sellers on their ecommerce marketplace platforms in an effort to circumvent laws prohibiting foreign owned retail businesses. The CCI’s investigation was delayed for more than a year by court challenges, but it was reinstated by a state court in Karanataka.
Context – The Indian ecommerce market is unique among the major growth markets due to its strict FDI laws prohibiting foreign ownership of multi-brand retail businesses, online or offline, but permissive rules allowing third-party marketplaces for independent sellers to be owned by non-Indian businesses. Both US-owned ecommerce businesses, which describe themselves as marketplaces for non-affiliated retailers, have faced years of accusations from Indian retailers that they violate the FDI laws and actually operate as retailers. A Reuters expose in February that was reportedly based on internal Amazon documents detailed the company’s questionable practices. Flipkart’s appeal to the Supreme Court noted that no similar evidence related to its business practices have emerged, but to no avail. While the CCI reviews the alleged conduct from a competition law perspective, the FDI enforcement agency has ongoing investigations as well. In addition, new ecommerce rules are expected to be in place soon, further reinforcing that marketplaces cannot preference any sellers. Finally, Amazon did get some good news from the Supreme Court, with Reliance Industries, an emerging domestic ecommerce powerhouse, seeing its bid to purchase Indian retailer Future Retail blocked by Amazon in a contract dispute.
Ride Sharing and Delivery Gig Work Platforms Start Ballot Initiative Process in Massachusetts
Report from Reuters
In Brief – The Massachusetts Coalition for Independent Work, a group led by “Gig work” platforms Uber, Lyft, DoorDash and Instacart, have submitted a ballot initiative proposal with the state’s Attorney General for certification that would begin the process to place the issue on the November 2022 ballot. If AG Maura Healey (D), who filed suit last year against Uber and Lyft for violating state employment laws by designating drivers as independent contractors, determines that the proposed question meets constitutional requirements, the coalition would need to collect nearly 100,000 signatures by late November. The proposal is similar to the highly contentious Prop. 22 that passed in California last November and overruled the state’s AB 5 law that required many Gig platform workers to be classified as traditional company employees. It would set an earnings floor equal to 120% of the state’s minimum wage for app-based rideshare and delivery drivers while engaged in driving, provide at least $0.26 per mile to cover vehicle costs and gas, and require the platforms to pay a healthcare stipends to drivers who work at least 15 hours per week. The fight is certain to be loud and expensive.
Context – After California enacted AB 5 in 2019, the state’s legislature doubled back in mid-2020 and exempted a wide variety of independent workers who objected to being classified as employees. Voters then exempted the ride sharing and delivery platforms entirely from the law with Prop. 22. No states followed California’s example in 2020, nor in the first half of 2021. Federally, the top labor movement priority is the PRO Act, passed in the US House earlier this year, to expand organizing rights. The highly partisan bill is unlikely to move in the Senate and gig labor issues will mostly play out federally at agencies like the Department of Labor, where regulations aligned with independent contractor business models were enacted in January 2021, but then withdrawn by the new Biden DoL leadership in May.
Europe to Review Facebook’s Kustomer Acquisition Despite Almost No EU Presence
Report from the Wall Street Journal
In Brief – As anticipated, the European Commission’s Competition Authority (ECA) has announced that it is proceeding to a full investigation of Facebook’s acquisition of Kustomer, a US-based customer relationship management (CRM) software startup. When the deal, reportedly in the range of $1 billion, was announced last November, the social network giant described it as a bid to grow Kustomer’s business as well as the utility of messaging service WhatsApp for business users. Although the acquisition did not meet the legal threshold for direct review by the European Commission, which is based on revenues of the acquired business, the Austrian Competition Authority claimed that it met its national threshold, based on purchase price. Austria, with the support of the Commission and a number of other Member States, engaged Article 22 of the EU Merger Regulation to ask the EU to step in and take up a review of the transaction. That initial review was announced in May, and the Commission is now proceeding to the next review phase, which runs 90 days, based on concerns related to markets for CRM software and online display advertising services.
Context – Along with Article 22 appearing to be serving as a short-term workaround for the EC’s legal thresholds for acquisition reviews in select industries, the German Competition Authority is also now stepping in to review the Kustomer deal, claiming it fits its new threshold, which includes high-price (above $400 million), low revenue acquisitions, which it says is “often an indication of innovative business ideas with great competitive market potential”. The EU’s review of the acquisition of medical technology company Grail by Illumina, which also involved an Article 22 referral, despite Grail having no EU business, is also worth watching. The ECA review was cited recently by the FTC, who is also fighting the tie-up. Widespread blocking of startup acquisitions by Big Tech is seen as a threat to investment and innovation by many in the venture capital community.
Indian High Court Sides with Amazon in Legal Showdown With India’s Reliance Industries
Report from the New York Times
In Brief – The Indian Supreme Court has sided with US-owned Amazon, the leading ecommerce platform in India, over Reliance Industries, the Indian conglomerate owned by the Mukesh Ambani, the country’s richest man, in a nearly year-long stand-off with major implications for the Indian retail and ecommerce market. Ambani’s Reliance, rapidly building an ecommerce business to challenge US-owned market-leaders Amazon and Flipkart, acquired key retail assets of Indian retailer Future Group last October, a deal Amazon challenged based on contract rights from on a 2019 investment in other Future Group assets. A Singaporean arbitration panel upheld Amazon’s challenge, Reliance and Future fought back in Indian courts challenging that venue and ability of US-based Amazon to block a retail industry transaction given Indian’s limits on foreign ownership of retail businesses, and the legal conflict worked its way to the Supreme Court. The high court sided with Amazon and the authority of the Singapore-based arbitration panel based on the original Amazon-Future Group contract. Although the initial arbitration panel halts the proposed Reliance-Future Group deal, the two companies indicated their intention to continue to pursue a tie-up as foreign-owned Amazon (and Flipkart) cannot buy retail businesses.
Context – Courts ruling against the prevailing domestic political tides or national governments is the definition of the Rule of Law. This decision sees the Supreme Court siding against the domestic economic powers. Put it in bucket with the US Federal court dismissal of the FTC and State AG antitrust complaints against Facebook, or the US Federal court injunctions blocking the Trump Administration efforts to shut down WeChat and TikTok. On the other hand, when an Australian judge delayed Epic Games’ antitrust suit against Apple as redundant given US litigation, the Australian competition regulator intervened in favor of domestic litigation and a higher court restarted the suit. Legal challenges to increasingly aggressive European tech regulation are going to test the judicial climate in the EU.
Food Delivery Platform Deliveroo May Leave Spain in Wake of Gig Worker Employment Law
Report from the Financial Times
In Brief – UK-based “Gig work” food delivery platform Deliveroo has announced that it will begin discussions with Spanish delivery riders about the prospect that the company will exit the market in the near future and focus on other markets that are more important to the company. Deliveroo’s market share in Spain trails leaders Uber Eats and Glovo, a Barcelona-based competitor. The company cited the Gig delivery platform employment law enacted in May requiring delivery personnel to be treated as employees as creating uncertainty and making the market less valuable. Uber Eats, Glovo and Just Eats Takeaway, a Dutch-based delivery platform, have all indicated that they will remain in Spain despite the new law.
Context – Along with requiring food delivery personnel to be categorized as employees, the Spanish law requires digital platforms to reveal to the drivers’ legal representatives information about how their driver algorithms function. Elsewhere in Europe, a Court of Appeals in the Netherlands ruled in February that Deliveroo couriers qualify as employees, an Italian court ruled that a reputational-ranking algorithm used by Deliveroo discriminated against gig delivery workers and breached local labor law, and in the highest profile Gig economy court result, Uber lost its worker classification appeal to the UK Supreme Court and will classify its UK drivers as company workers. While many worker advocates have long objected to independent work platforms, and the European Commission is pushing for some form of labor organizing for platform workers, some Spanish drivers have objected to the new law. Many Gig platform users genuinely value the independence and flexibility of the model, with studies consistently finding a majority prefer flexibility and independence to traditional work with traditional benefits. For them, it is a way to earn extra money. More money needed, more time spent. However, make no mistake, around a quarter of Gig workers are consistently unhappy and governments, especially in Europe, are responding to them.
AirBNB Again Fined in France Over Regulatory Mandates for Short-Term Rental Listings
Report from Le Figaro
In Brief – AirBNB has been fined 300,000 Euros by the French Directorate-General for Competition, Consumer Affairs and Fraud Control (DGCCRF) for failing to appropriately notify consumers of a range of information required by French law, including whether a property’s host was an individual or professional, the right of withdrawal available to short-term renters, and civil liability with regard to accidental damage caused to a dwelling. The most recent fine follows the significantly larger penalty of more than 8 million Euros imposed by a Paris Court in June for allowing over 1,000 listings of Paris properties that did not include a mandatory registration number designed to track listings and keep them individually under 120 days a year. The Paris Government had filed suit in 2019 following enactment of new regulations in 2017. AirBNB has stated that all Paris listings now require a registration number to be rented, a policy that will be extended to other French cities with similar requirements.
Context – Short-term rentals and the digital platforms that facilitate them have been highly controversial in Europe, especially in the most popular tourist destinations like Paris, Barcelona and Amsterdam. Paris officials, led by the Mayor, have been particularly vociferous, arguing that short-term rentals undermine neighborhoods and affordable housing, and the opposition is spreading to other French cities leading to more rentals in smaller and rural locales. The 2019 ruling of the European Court of Justice that AirBNB should be considered an ‘information society service’ rather than a real estate business is one of the most important in Europe for platforms and has translated into other court wins for short-term rental platforms that allow property owners to set prices and terms. The Digital Services Act (DSA) is likely to include blanket regulatory responsibilities for rental platforms, something AirBNB itself has indicated could be helpful by setting EU-wide rental platform standards.
Google Faces More Play Store Litigation – This Time a Consumer Class Action in the UK
Report from the BBC
In Brief – The legal complaints alleging that Google engages in anticompetitive practices through the fees and policies of its app Play Store continue to grow, with the filing of a “collective actions” suit, the UK version of a class action lawsuit, in the UK Competition Appeal Tribunal (CAT). The UK is increasingly becoming a venue for app store-related litigation that is targeting the same conduct in major markets globally. Apple was the target of a similar consumer class action complaint in May. Epic Games, the giant game developer who kicked off a global litigation campaign by filing federal lawsuits in California last August against both Apple and Google, also filed suits at the UK CAT in January. Epic’s suit targeting Apple was dismissed by the CAT, with the judge ruling that the US-based case, already well underway, was the more appropriate venue, but Epic’s UK suit targeting Google was allowed to continue.
Context – Neither Apple nor Google is clearly dominant in smart phone operating systems. Both hold larger market shares depending on how you measure size, or by geography. Nevertheless, app store fees and policies have emerged as a leading digital competition issue globally. Both companies charge large app developers a 30% commission for in-app payments. That rate is in line with many digital services marketplaces. They otherwise have always had very different models. Apple has always operated the iPhone with a restrictive “walled garden” approach. Google has alternatively always had more permissive mobile operating system practices, although the Android brand has always come with many conditions for developers and hardware companies. Both Apple and Google point to the other in their own defense, arguing that there is competition and consumer choice. The headline legal event remains the US trial pitting Epic against Apple. Oral arguments concluded in May and a decision may come in August. It should provide insights into key questions on market definition, pricing and legal theories.
Zoom Agrees to Settlement Ending Class Action Suits Over 2020 Security and Data Practices
Report from the New York Times
In Brief – Online video conference service Zoom, which exploded into the public consciousness in the early days of the pandemic, and plaintiffs in a collection of class action suits alleging the company engaged in deceptive security and data practices, have agreed to an $85 million settlement. As tens of millions of Americans engaged in video conferences in the early weeks of the lockdowns, unwanted “Zoom-bombing” that sometimes includes pornography and racism gained attention and notoriety. Although Zoom does not admit to any wrongdoing, it is agreeing to refund subscribers between $15 and $25, notify users when others use third-party apps during meetings, and provide improved privacy and data handling training to its employees. The settlement must still be approved by the presiding federal judge.
Context – Last November, the Federal Trade Commission (FTC) and Zoom settled a complaint covering essentially the same ground, with Zoom agreeing to improve security practices and transparency. The settlement was approved by a partisan 3-2 vote, with the two Democrats arguing that that the settlement did not include any help for affected parties, no monetary penalty or compensation, and no admission of liability. This private litigation settlement, which could not have been completely unexpected, appears to have addressed the issue of monetary compensation and penalty. One of the changes in the digital policy landscape expected with the Biden Administration was a much more aggressive FTC on enforcement matters. Recent years saw a series of 3-2 decisions on major digital cases with the Democratic commissioners decrying a lack of redress, weak (or no) financial penalties, nor admissions of wrongdoing, including on the Facebook (Cambridge Analytica), Google (YouTube COPPA violations), Zoom and Sunday Riley Skin Care cases. While the new FTC leadership has been quite visible on Big Tech antitrust and broader competition policy, there has not been a lot new on the digital regulation front.
Google (and Facebook) Square Off with Plaintiffs Over Digital Ad Suits Venue Consolidation
Report from Reuters
In Brief – The Judicial Panel on Multidistrict Litigation (JPML) has become the latest forum in a battle pitting Google (and Facebook) against a collection of private plaintiffs and government antitrust enforcers alleging anticompetitive practices in the digital advertising market. The JPML manages multidistrict litigation and centralizes civil cases filed in different districts that involve common questions to conserve resources and avoid inconsistent pretrial rulings. Google and Facebook argue that the ad-focused antitrust suits brought by State AGs, publishers, advertisers and small businesses, should be consolidated in the Northern District of California, where the companies are based. The plaintiffs oppose consolidation, a position Judge Matthew Kennelly serving on the JPML noted as unusual and “perplexing” given the clear overlap in the cases. As a fallback, the plaintiffs argued that if the cases were combined, it should be in the Eastern District of Texas, where the State AG suit is underway.
Context – US antitrust enforcers have filed four suits targeting Google. Three are from State AGs, dealing with advertising, search and the Play Store. A DoJ-led suit also focuses on search. While three of the four have been filed in Federal District Court in the District of Columbia, Texas AG Ken Paxton filed the advertising-focused suit, with backing from 14 other states, in the Eastern District of Texas. In May, he prevailed over Google’s attempt to move the case to California. Legislation to exempt all antitrust cases brought by State AGs from federal court consolidation, just as federal antitrust cases are exempt, and giving AGs a sort of “home field advantage” over companies, has significant bipartisan support on Capitol Hill, and comments from the Federal Judge leading the Administrative Office of the Courts opposing the idea was tied to the Google case controversy and led to a sharp written rebuke from the bipartisan leaders of the Senate and House Antitrust Subcommittees.
Luxembourg Hits Amazon with Unprecedented GDPR Fine for Advertising Practices
Report from the Wall Street Journal
In Brief – The Luxembourg National Commission for Data Protection (CNPD), the country’s data protection authority, has fined Amazon 746 million Euros for violating the General Data Protection Regulation (GDPR), the EU’s landmark data security and privacy law enacted in 2018. The CNPD is the lead GDPR regulator for Amazon because Luxembourg is the Member State where Amazon has its European Headquarters. The fine, which became public when it was mentioned in a filing Amazon made with the US Securities and Exchange Commission, is the largest ever imposed under the GDPR, dwarfing the 204.6m Euros imposed on British Airways, 110.3m Euros on Marriott Hotels, and 50m Euros on Google. The CNPD has not commented directly on the fine nor detailed the violations committed by Amazon, but Amazon stated that the fine did not involve a data breach but instead regards “how we show customers relevant advertising,” arguing that the decision “relies on subjective and untested interpretations of European privacy law.” Amazon has stated that the penalty will be appealed in the European courts.
Context – While EU leaders are proud of the global uptake of GDPR-style regulations, many privacy advocates and Big Tech critics are extremely frustrated that the GDPR has not resulted in large penalties being imposed on US digital giants. They often blame the “One-Stop-Shop” policy and criticize the risk-averse privacy regulators in Ireland and Luxembourg, the two countries that are home to the European Headquarters of most of the largest US digital firms. This decision certainly appears to stand that criticism on its head, especially if the case is based on the contention that advertising that goes on within the Amazon website based on user activity on the Amazon website is a violation of the GDPR, as that would be a first. The role of national data protection authorities besides the lead authority to bring GDPR complaints to national courts has also recently been expanded by Europe’s highest court, further weakening the one-stop-shop regime.
State AGs Not Giving Up on Facebook Suit – Will Appeal Recent Dismissal Setback
Report from the New York Times
In Brief – The Attorney General of New York, who led the coalition of attorneys general from 47 states and the District of Columbia that filed a federal antitrust suit in December accusing Facebook of anticompetitive conduct over nearly a decade, has announced that the coalition would be appealing the recent ruling of Federal Judge Jame Boasberg to dismiss the states’ high-profile suit. Their complaint focused on Facebook’s acquisitions of Instagram (2012) and WhatsApp (2014), portraying them as illegal efforts to shutdown social media competitors, and called for the acquisitions to be unwound. The Federal Trade Commission (FTC) filed a parallel antitrust suit. Judge Boasberg created a stir in June by granting the Facebook motions to dismiss against both the FTC and State AG complaints. While the FTC was granted 30 days, since extended by an additional three weeks, to refile its complaint to address the shortcomings noted by the judge, the State AGs’ lawsuit was dismissed in its entirety on the grounds that the AGs had waited too long after the Instagram and WhatsApp acquisitions to bring their legal claims.
Context – Last December’s FTC and State AG lawsuits, which included nearly every State AG on the same complaint, offered a greater sense of unity and clarity than the collection of four suits targeting Google, covering search, advertising and, most recently, the Play Store. However, Boasberg’s unexpected dismissals sent a clear message that legal precedents and judges will have a major impact on the process in the US, writing in his FTC dismissal that “It is almost as if the agency expects the court to simply nod to the conventional wisdom that Facebook is a monopolist.” While the FTC, which reportedly recently ended the relationship with the key economic consultant that helped craft its complaint, has until August 19 to put forward a new complaint and get its case back on track, the State AGs will now be on a much slower calendar even if the Federal Court of Appeals for the District of Columbia eventually overturns the June dismissal ruling.