Antitrust Violations and Penalties
a) Violation of Sherman Act Section 2 (15 U.S.C. § 2)
Monopolization or attempt to monopolize the market
Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $100,000,000 if a corporation, or, if any other person, $1,000,000, or by imprisonment not exceeding 10 years, or by both said punishments, in the discretion of the court.
Criminal Penalties:
- Felony charges for individuals
- Up to 10 years in prison for individuals
Why not? What is stopping the powers that be? You can indict a ham sandwich. If they don't qualify, who does? Why not?
Civil Penalties:
- Fines up to $1 million for individuals
- Fines up to $100 million for corporations, or twice the amount gained from the illegal acts or twice the money lost by the victims if either of those amounts is over $100 million
b) Violation of Clayton Act Section 3 (15 U.S.C. § 14)
Exclusive dealing arrangements that substantially lessen competition.
Penalties:
- Civil: Injunctive relief and treble damages
c) Violation of FTC Act Section 5(a) (15 U.S.C. § 45(a))
Covers a wide range of deceptive or unfair business practices.
Penalties:
- Civil: Cease and desist orders, injunctions, and monetary penalties
Legal Basis and Relevant Case Law for Antitrust Claims
Legal Basis and Relevant Case Law
1. Sherman Act Section 2 (monopolization)
- United States v. Microsoft Corp., 253 F.3d 34 (D.C. Cir. 2001): Established that a company can violate Section 2 by engaging in anticompetitive conduct that maintains its monopoly power
- Verizon Communications Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398 (2004): Discussed limits on a monopolist's duty to assist rivals
2. Clayton Act Section 3
Makes it illegal to enter into tying arrangements, exclusive dealing contracts or requirements contracts if such arrangements or contracts tend to lessen competition
- Jefferson Parish Hospital District No. 2 v. Hyde, 466 U.S. 2 (1984): Set standards for analyzing tying arrangements under antitrust law
- United States v. Dentsply Int'l, Inc., 399 F.3d 181 (3d Cir. 2005): Addressed exclusive dealing arrangements and their potential to foreclose competition
3. FTC Act Section 5(a) (unfair methods of competition)
- FTC v. Sperry & Hutchinson Co., 405 U.S. 233 (1972): Established that the FTC has broad powers to determine unfair competitive practices beyond those forbidden by the Sherman Act or Clayton Act
- FTC v. Indiana Federation of Dentists, 476 U.S. 447 (1986): Demonstrated that concerted refusals to deal with third parties can violate antitrust laws
Relevant Case Law
United States v. Microsoft Corp., 253 F.3d 34 (D.C. Cir. 2001)
Landmark case dealing with monopolization in the operating system market
Microsoft had monopoly power in the PC operating system market and took actions to maintain this monopoly, violating Section 2 of the Sherman Act
Ohio v. American Express Co., 138 S. Ct. 2274 (2018)
Involved anti-competitive practices in a two-sided market, analogous to social media platforms
Both sides of a two-sided market must be considered when analyzing anti-competitive effects
FTC v. Qualcomm Inc., 969 F.3d 974 (9th Cir. 2020)
Deals with alleged anti-competitive practices in licensing technology
Emphasized the importance of proving harm to competition, not just competitors
United States v. Apple, Inc., 791 F.3d 290 (2d Cir. 2015)
Involved allegations of conspiracy to raise e-book prices
Apple orchestrated a conspiracy among book publishers to raise e-book prices
Pepper v. Apple Inc., 139 S. Ct. 1514 (2019)
Allowed consumers to sue Apple for alleged monopolistic practices in its App Store
Consumers who purchase apps from Apple's App Store can sue the company for alleged monopolization
hiQ Labs, Inc. v. LinkedIn Corp., 938 F.3d 985 (9th Cir. 2019)
Deals with a company's right to access and use data from a social media platform
LinkedIn could not deny hiQ access to publicly available member profiles
United States v. Google LLC, No. 1:20-cv-03010 (D.D.C. filed Oct. 20, 2020)
Ongoing case dealing with allegations of monopolistic practices by a major tech company
DOJ alleges Google has unlawfully maintained monopolies in search and search advertising
FTC v. Facebook, Inc., No. 1:20-cv-03590 (D.D.C. filed Dec. 9, 2020)
Directly involves Meta (Facebook) and alleges monopolistic practices in personal social networking services
FTC alleges Facebook maintained its monopoly by buying up competitive threats and imposing restrictive policies
New York v. Facebook, Inc., No. 1:20-cv-03589 (D.D.C. filed Dec. 9, 2020)
Filed by 48 state attorneys general, alleges Facebook illegally stifles competition
Focuses on Facebook's acquisitions of Instagram and WhatsApp, and policies regarding third-party apps
FTC v. Surescripts, LLC, 424 F. Supp. 3d 92 (D.D.C. 2020)
Deals with allegations of maintaining monopoly power through exclusionary contracts
Court denied Surescripts' motion to dismiss, allowing FTC's monopolization claims to proceed
Klein v. Facebook, Inc., No. 5:20-cv-08570 (N.D. Cal. filed Dec. 3, 2020)
Class action lawsuit alleging Facebook's acquisitions were part of a scheme to neutralize competitive threats
Argues Facebook's actions harmed users by depriving them of choice and innovation in personal social networking
Citations
- Economic Liberties: FTC v. Facebook
- Casetext: FTC v. Facebook, Inc.
- FTC: $5 Billion Penalty and New Privacy Restrictions for Facebook
- FTC: Facebook's "Buy-or-Bury" Scheme
- Reason: FTC's Lawsuit Against Facebook
- PYMNTS: FTC Claims Meta Withheld Key Details
- Fortune: FTC: Facebook Withheld Information
- Wikipedia: FTC v. Meta Platforms, Inc.
Joseph Dean against Meta Platforms Inc. (formerly Facebook Inc.) alleging anti-competitive behavior and monopolistic practices:
- Joseph Dean developed a platform called Veamcast, which he claims was hindered by Facebook's actions. Dean alleges that Facebook:
- Denied access to their API through deceptive means.
- Changed their API to downgrade Plaintiff's application as well as that of all 3rd party developers
- Falsely flagged content posted by Plaintiff's product as spam or abusive
- Removed thousands of posts pointing to Veamcast content without explanation
- The complaint cites various antitrust laws and investigations into Facebook's practices, including:
- Sherman Act Section 2
- Clayton Act Section 3
- FTC Act Section 5(a)
- Dean claims Facebook's actions prevented Veamcast from gaining users and raising funds, causing significant financial and emotional damage.
- The plaintiff seeks $1.4 trillion in damages, which he claims is the approximate market value of Meta Platforms.
- The complaint includes correspondence between Dean and Facebook support teams, which he presents as evidence of Facebook's deceptive practices.
- Dean also presents evidence of other instances of alleged intellectual property theft from him by Roku and Nintendo.
- The document calls for criminal investigations into Meta's officers, including Mark Zuckerberg, and suggests breaking up the company.
- Dean is filing this complaint pro se (representing himself) after previous attempts to file and obtain counsel were unsuccessful.
The complaint paints a picture of Facebook/Meta as a monopolistic entity that uses its market power to stifle competition and maintain dominance in the social media space.
QUICK SUMMARY: Facebook shut off the entire Veamcast platform removing all prior posts. They refuse to give any answer as to why. They shut off large portions of their APIs from third party developers. They shut off other portions just for us with error messages which were not based on anything and when we reached out for support, they gave us a colossal runaround then just closed and deleted the thread. If we hadn't saved the thread, there would be no proof.
- Read Exhibit #2 (thread with Facebook Support about App Review) in the complaint where Facebook required that our currently working app get re-approved.
- They removed everything ever posted and gave bogus error message to new posts.
- When our posts were flagged, we clicked the option to appeal 100s or 1,000s of times and never received a response.
- For other parts of the complaint, know that there were no objectional posts that we were ever made aware of.
- They give us a big runaround, then close the thread and remove it from our view.
COMPLAINT OF COPYRIGHT, TRADEMARK AND CONCEPT THEFT:
In 2005, Joe Dean began a startup named Electronic Sports. We were funded by Bigfoot. Its premiere product named Dogfight was an exercise bike interfaced with a flight simulator. Users would pedal, the prop would spin and players could shoot down balloons for points or compete in aerial combat. One player would be blue and the other red.
See Electronic Sports' Dogfight - Active Flight Simulator here.
Nintendo created one called Wi Sports Airplane Dogfight in which players passively sit at a game console and shoot down balloons for points or compete in aerial combat. One player would be blue and the other reddish.
See Nintendo's version of Dogfight here.
Apparently, it's very popular among U.S. Presidents. (Joe Dean was not involved in the creation of this video).