A U.S. federal court has allowed key antitrust claims against Meta Platforms to proceed in a lawsuit brought by the now-defunct photo-sharing app Phhhoto. The case, heard in the Eastern District of New York, centers on allegations that Meta used its control over Facebook and Instagram to suppress a competing service.
The court found that Phhhoto plausibly argued that its content visibility was reduced through platform mechanisms, including algorithmic changes, which may have limited its ability to compete in the personal social networking market. The ruling also permits claims that Meta relied on confidential information obtained during prior business discussions to develop a competing product, raising concerns around potential misuse of commercially sensitive data.
The lawsuit traces back to Phhhoto’s growth between 2014 and 2016, when it gained significant user traction before shutting down in 2017. The company alleges that Meta’s conduct contributed to its decline by restricting distribution and introducing a similar feature through its own platforms. While the court dismissed certain aspects of the complaint, it determined that sufficient grounds exist for the central antitrust claims to move forward.
The case follows earlier procedural developments, including an appellate directive in 2024 requiring reconsideration of previously dismissed claims. It adds to broader regulatory scrutiny of Meta’s market conduct, including ongoing proceedings related to its acquisitions and competitive practices within digital platforms.
