Facebook Faces New Antitrust Lawsuit

The suit, filed by the now defunct photo start-up Phhhoto, accused the social network of stalling on a deal and then putting it out of business. From a report: Mark Zuckerberg, Facebook’s chief executive, downloaded a popular new app, Phhhoto, on Aug. 8, 2014, and took a selfie. Other Facebook executives and product managers soon followed suit. The social network then made overtures to integrate Phhhoto. But the interest of Facebook’s top executives in Phhhoto was just a show, according to a lawsuit filed on Thursday in the Eastern District of New York by the start-up, which is now defunct. Instead, Facebook simply wanted to squash the competition, according to the suit, which accused the company of antitrust violations. In the suit, Phhhoto’s founders — Champ Bennett, Omar Elsayed and Russell Armand — claim that after Mr. Zuckerberg and other Facebook executives downloaded their app and approached them about a partnership, no deal materialized. Facebook instead launched a competing product that mirrored Phhhoto’s features. Facebook also suppressed Phhhoto’s content within its photo-sharing app, Instagram, the suit says.

Phhhoto is represented by Gary L. Reback, a well-known lawyer. In the 1990s, Mr. Reback persuaded the Justice Department to sue Microsoft for violating antitrust laws, a case that Microsoft ultimately settled in 2001. Phhhoto’s suit seeks unspecified monetary damages from Facebook. The lawsuit stands out because of Mr. Zuckerberg’s personal involvement, Mr. Reback said in an interview. He called Mr. Zuckerberg “the monopolist’s C.E.O” and said the Facebook founder had engaged in “anticompetitive conduct to an extent not seen since Bill Gates,” one of the founders of Microsoft.

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