A November 18 federal trial court decision favoring Facebook is the first decisive win for a big tech digital platform in a suit brought by the federal government. District of Columbia Judge Jed Boasberg’s opinion striking down the Federal Trade Commission’s monopolization suit against Facebook appears sound and well-reasoned and will be hard to overturn on appeal.
The decision also may have broader implications for U.S. antitrust suits brought against high tech firms. It stresses how tech markets have changed significantly in recent years, making restrictive market definitions, such as the one put forth by the FTC here, hard to defend. Antitrust cases that retard innovation by focusing on narrow conditions at one point in time may miss the bigger economic picture.
The Case in a Nutshell
In December 2020 the FTC (joined by 46 states) sued Meta, Facebook’s parent company, in federal district court. It alleged that Facebook had monopolized an online “social networking market” by (among other tactics) acquiring then-rivals WhatsApp and Instagram. The Commission urged that Facebook be ordered to sell WhatsApp and Instagram to third parties in order to restore competition.
After several years of procedural wrangling, the case eventually went to trial in April 2025. Judge Boasberg oversaw the proceedings, which featured extensive testimony and document review. He issued a detailed judgment on November 18 finding that the FTC had failed to prove its case.
Antitrust monopolization requires that a firm is shown (1) to hold “monopoly power” (a great deal of market power) in a particular market; and (2) to have engaged in “exclusionary acts” (commercial acts “not on the business merits”) that harm rivals or tend to exclude new competitors from entering the market.
The FTC’s argument that Facebook gained a social networking monopoly by merging with WhatsApp and Instagram was problematic from the start. The FTC had previously analyzed those acquisitions and found that they were not anticompetitive. Very significantly, Judge Boasberg found that YouTube and Tiktok now compete vigorously with Facebook.
Tiktok “opened a new path that traditional social networks had not yet explored: an AI algorithm that shows users content based not on their friends, but on their interests.” YouTube “lets users upload videos and watch the billions of videos uploaded by others” and “also recommends videos based on each user’s interests and what others are watching.”
The court concluded that in a market including “Facebook, Instagram, Snapchat, MeWe [a small rival], TikTok, and YouTube[,]” Meta’s shared did not show monopoly power. Absent monopoly power, Facebook could not be found liable for illegal monopolization in this market. Rapid innovations in the nature of digital apps had transformed the marketplace, rendering the digital world portrayed by the FTC dated and irrelevant.
Don’t Forget Consumer Benefits and Innovation
While market definition was key to the court’s ultimate holding, additional discussion by Judge Boasberg shed light on the fact that Facebook’s activities had generated substantial economic benefits.
Judge Boasberg found it “impossible to believe that consumers would prefer the versions of Instagram and Facebook that existed a decade ago to the versions that exist today,” implying that product improvements driven by competition have benefited consumers.
Indeed, economic research indicates that “digital goods” associated with platforms have brought forth enormous levels of new consumer welfare (the key goal of antitrust according to leading scholars and the Supreme Court). One estimate by leading scholars found that digital goods bestowed trillions of dollars in annual benefits to consumers.
The scale of the economic benefits of platform innovation for the American economy merit being highlighted. U.S. courts overseeing digital markets cases may be finally awakening to the fact that antitrust ignores beneficial changes in market conditions at its peril. Bringing costly antitrust suits that retard innovation is not MAGA. Federal antitrust enforcers may want to take note of this.