The Federal Trade Commission sued to block Facebook-owner Meta from buying virtual reality fitness app maker Within Unlimited on Wednesday.
Khan described her philosophy behind risky lawsuits in a"Even if it's not a slam dunk case, even if there is a risk you might lose, there can be ... enormous benefits from taking that risk," Khan said."I think what we can see is that inaction after inaction after inaction can have severe costs. And that's what we're really trying to reverse.
Facebook has made a number of strategic acquisitions as it grew, most notably buying photo social network Instagram and private messaging app WhatApp for $19 billion in 2014. Some antitrust advocates believe the FTC at that time let the company off the hook during its reviews of those mergers, allowing Facebook to buy nascent rivals without obstruction., that Facebook actually used those acquisitions to grow its monopoly by eating up potential rivals.
But while some of the circumstances may be similar, Kovacic noted that the FTC's Meta-Within merger complaint does have unique features that could make its case more challenging to prove. For example, he said, this deal is an example of a vertical merger, where Meta would be using the acquisition to add a complementary feature.
"The theory in Instagram was more that Instagram was a real threat to become a direct rival as a social network," he said.He suspects there will be more risky cases to come from the enforcement agencies. "I sense that this is the first of a series of cases that are designed very consciously to test the boundaries of doctrine," Kovacic said."I have to think there are others in the pipeline. But it's a big step."
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