WASHINGTON—Today, Meta asked a judge to dismiss the Federal Trade Commission’s case against its acquisition of Within Unlimited, a small virtual reality fitness company.
The FTC’s weak case against Meta’s acquisition of Within depicts what happens when a federal agency operates without an objective legal standard. Today’s FTC majority completely disregards the “consumer welfare standard” – the foundation of antitrust law for the past 40 years. It is an objective analysis of consumer harm in the marketplace.
Under the consumer welfare standard, an antitrust lawsuit must show (1) a company has market power, (2) is abusing that power and (3) proof that those actions then result in consumer harm. However, in challenging Meta’s acquisition of Within, FTC Chair Lina Khan went against the consultation of her own staff.
“Good on Meta for pushing back against this rogue FTC’s irresponsible crusade against American success,” said Carl Szabo, Vice President and General Counsel for NetChoice. “This lawsuit was absurd from the start and shows that today’s progressive FTC wants to control everything American businesses do in the marketplace, regardless of logic or law. These unelected bureaucrats think they know better than consumers and businesses about how markets should work, but really, they’re just crushing innovation and raising prices for Americans.”
“The real source of consumer harm is the FTC’s unlawful suits. If the agency really cares about preventing consumer harm, it would stop this war on American businesses,” said Szabo.
“Now that we’ve seen how an agency like the FTC operates without objective standards of evaluation, our leaders must resist granting it any additional power over us,” continued Szabo. “Khan’s FTC is shaking down American businesses of all stripes, but it is being rejected even by left-leaning courts.”
A recent editorial from The Wall Street Journal explains Khan’s logic in the suit, which is called, “actual potential competition.” Under this vague ideology, any merger can be dubbed illegal by requiring a company to prove that it wouldn’t try to make its own product if it doesn’t go through with an acquisition, which is an impossible standard for any company to prove. Khan knows this.
Basically, this FTC has failed to bring cases showing real evidence of harm, so it’s trying to remove the objective standards of harm so it can bring cases against companies it doesn’t like.
Under the leadership of Khan and the Biden administration, the FTC is hurting innovation, wasting taxpayer dollars and restricting American freedom. NetChoice is glad to see Meta stand up to it.