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Facebook cleared of antitrust claims (Updated)

October 23, 2009 9:46pm
by David Gelles

Earlier this year we asked if Facebook was “monopolising the social networking market“.

An upstart social network aggregator, Power.com, had sued Facebook in California court, and it looked like the law might force Facebook to open up its walled-garden. Power was alleging that Facebook restricts users and stifles competition, and was in violation of California’s unfair competition laws and US antitrust laws.

The answer seems to be no. On Friday a judge dismissed the case. Power’s claims “contain no factual allegations,” wrote US district judge Jeremy Fogel.

Facebook, meanwhile, is continuing its own case against Power. Earlier this year Facebook sued Power for “scraping” data off its site, a violation of Facebook’s terms of service.

Though it looks like Power’s suit was nipped in the bud, the episode has raised an important issue for web users. At issue is “data portability”, the ability to take personal information from one website to another freely. Critics say Facebook flouts this freedom and prevents users from interacting with the broader web.

However, while Facebook does not allow users to export their contacts or download their photos and updates en masse, it is working with groups that advocate open standards.

It joined the Data Portability Project, which promotes open standards. It is on the board of the OpenID Foundation, which is working on a more open, integrated login system for the web. Through Facebook Connect, it allows users to log on to more than 10,000 other sites.

As Marc Canter, chief executive of Broadband Mechanics and an expert on data portability, told us in July: “They’re doing everything they can to be open while remaining closed.”

Update: In a statement, Power says it will fight on.

Earlier in the case Judge Fogel granted Power’s motion to require Facebook to provide a more detailed pleading of its claims.  Yesterday’s order essentially does the same thing with respect to Power’s counterclaims and affirmative defenses.  The Court determined that Power’s pleading did not provide enough detail with respect to the fair use defense and other affirmative defenses, and also with respect to the counterclaims under the unfair competition laws.  The Court gave Power 30 days, until November 21, 2009, to re-plead their defenses and counterclaims with more detail.  Power intends to do so.

This is a routine type of order that often occurs in the early stages of litigation, where the parties dispute the sufficiency of the pleadings in terms of the level of factual detail that is provided.  Power is confident that it will be able to amend its pleading within 30 days to satisfy the Court’s concerns.

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October 23, 2009 9:46pm in Digital media | Comment

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