August 24, 2020
The Federal Trade Commission often interviews witnesses under oath as part of investigations that lead to lawsuits. It’s telling, then, that, according to sources, Facebook chief executive Mark Zuckerberg testified remotely and under oath over a two-day FTC “investigative hearing.” Those sources also pointed out that Zuckerberg’s testimony doesn’t guarantee the case is headed toward an antitrust lawsuit but could be used by the FTC and state attorneys to build their case. State officials also participated in the hearing.
Politico reports that, “Zuckerberg testified in July before a House panel as part of an antitrust probe of the tech industry” and “faced stiff questioning about the company’s acquisitions of Instagram and WhatsApp.” At that hearing, representative Pramila Jayapal (D-Washington) read text messages between Zuckerberg and Instagram cofounder Kevin Systrom and questioned “whether [he] threatened to copy rivals if they didn’t agree to sell” to Facebook.
Zuckerberg denied the charges, although Systrom “sold Instagram to Facebook for $1 billion in 2012 and left the company in 2018.”
Critics lambasted the FTC “for not seeking to interview Zuckerberg — the company’s controlling shareholder in addition to its chairman and [chief executive] — as part of an earlier investigation into the Cambridge Analytica scandal.” FTC chair Joe Simons defended the decision by saying that, “sometimes it’s important to depose the CEO, and sometimes it’s not necessary.” “When it’s important we do it,” he told the Senate Commerce Committee’s August 5 oversight hearing.
To settle the Cambridge Analytica case, Facebook paid $5 billion and was required to create an internal “independent committee to oversee the company’s privacy decisions.”
The New York Times reports that Facebook spokesperson Andy Stone said the company was “committed to cooperating with the U.S. Federal Trade Commission’s inquiry and answering the questions the agency may have.” The FTC probe is looking at “whether Facebook bought startups like Instagram and WhatsApp in order to squash young and potentially dangerous competitors.”
In addition to collecting documents, the FTC has “also contacted the founders of startups that Facebook bought.” The investigation is expected to last beyond the presidential election in November.