Facebook stocks jumped 4.2% this week and continue to rise on the back of a decision by a US district judge to dismiss two antitrust lawsuits against the tech giant.
With its share price sitting at $355.64, the social media giant has become one of only five companies in the world with a valuation of over $1 trillion, joining Apple, Alphabet, Amazon, and Microsoft.
Facebook, along with several other tech giants, has been under intense scrutiny from regulators recently. These regulatory bodies have expressed concerns that the companies are effectively operating as monopolies. On Monday, the Federal Trade Commission and 48 state attorney generals brought separate cases to a Federal Court aimed at undoing Facebook’s acquisition of Instagram and WhatsApp.
Both these cases focused on allegations that Facebook is guilty of buying up competitors and denying consumers access to alternatives that would better protect their privacy.
The case was dismissed by US District Judge James Boasberg of the District of Columbia. Judge Boasberg said that there was no clear evidence that suggests Facebook controls more than 60% of the social media market.
Judge Boasberg said – “The services are free to use, and the exact metes and bounds of what even constitutes a social network i.e., which features of a company’s mobile app or website are included in that definition and which are excluded, are hardly crystal clear.”
He added that – “The FTC’s inability to offer any indication of the metrics or methods it used to calculate Facebook’s market share renders its vague 60 percent plus assertion too speculative and conclusory to go forward.”
Dismissing the case, the Judge said – “Although the Court does not agree with all of Facebook’s contentions here, it ultimately concurs that the FTC’s complaint is legally insufficient and must therefore be dismissed.”
The Federal Trade Commission’s case was dismissed without prejudice, meaning that the government can file an amended trust case against the company within the next 30 days. The case raised by the states was dismissed in its entirety.
Dismissing the states’ case, Judge Boasberg said that they had delayed too long in filing their allegations. He noted that as far as the acquisition of Instagram and WhatsApp went –
”The States’ long delays were unreasonable and unjustified as a matter of law. Both acquisitions were, per Plaintiffs’ allegations, publicly announced, and the States were thus aware or certainly should have been aware of them from those points onward.”
In response to the ruling, a Facebook company spokesman said – “We are pleased that today’s decisions recognize the defects in the government complaints filed against Facebook. We compete fairly every day to earn people’s time and attention and will continue to deliver great products for the people and businesses that use our services.”
After the favorable ruling, Facebook’s stocks soared in late-day trading and the company ended the day with its highest ever market capitalization. This makes Facebook the youngest of the world’s five trillion-dollar companies.
Dow Jones Market Data shows that the company has added $592 billion to its valuation since March 2020.