Facebook Inc., which crossed the $1 trillion valuation mark on Monday, is giving new meaning to the term Teflon-coated, as nothing bad ever seems to stick to it.
Facebook FB, +4.18% on Monday proved again that it is the Teflon company, with the news that it is avoiding U.S. charges of monopolistic behavior. On Monday, a federal judge in the District of Columbia dismissed the Federal Trade Commission’s complaint against Facebook, a suit that alleged the social network is a monopoly and is violating U.S. antitrust laws. The FTC has 30 days to amend its complaint against Facebook, but another case filed by a group of 46 U.S. state attorneys general was dismissed in its entirety, with the judge ruling that they waited too long to file.
“Although the court does not agree with all of Facebook’s contentions here, it ultimately concurs that the agency’s complaint is legally insufficient and must therefore be dismissed,” wrote U.S. District Court Judge James Boasberg, in a 53-page opinion.
As Facebook’s shares surged after the ruling, its valuation closed over $1 trillion for the first time, getting closer to the other trillion-dollar tech companies: Apple Inc. AAPL, +1.25%, Microsoft Corp. MSFT, +1.40%, Amazon.com Inc. AMZN, +1.25% and Alphabet Inc. GOOG, -0.14% GOOG, -0.14% GOOGL, +0.02%. Facebook has managed to continue its ascent despite numerous negative events, including the Cambridge Analytics scandal, misinformation on its platform, CEO Mark Zuckerberg’s various testimonies on Capitol Hill and repeated warnings to Wall Street from its CFO about a coming deceleration in ad revenue. But negative news just does not seem to stick.
The company is not entirely out of the clear in the antitrust realm, but the judge’s opinion has some interesting points, especially noting the FTC’s allegations that Facebook’s market share is “in excess of 60%” yet concluding that the allegations
“ultimately fall short of plausibly establishing that Facebook holds market power.”
The next 30 days will be telling, as to whether the FTC decides to file an amended complaint and how the agency might address the judge’s concerns.
“The FTC ruling was a surprise to the Street, but we view it as a long ‘Game of Thrones’ battle between Facebook, Amazon, Apple and Alphabet versus the Beltway over the coming years,” said Dan Ives, an analyst with Wedbush Securities, in an email.
Even so, Facebook has, amazingly, continued to deflect major legal issues time after time. Whether regulators should take another tack and instead focus on the company’s past privacy and data-collection issues is a question that remains. But even as all these legal machinations continue in the background, Facebook is still managing to win.