Meta Platforms persuaded a U.S. federal judge to dismiss a lawsuit that accused the company of illegally monopolizing shopping on Instagram by stealing the business plan of a now-defunct startup.
Here are the details:
U.S. Magistrate Judge Virginia DeMarchi in San Jose, California, on Friday dismissed, opens new tab claims brought by London-based Ollywan, which had alleged last year that Meta copied its concept for a “tag-based” shopping platform before launching Instagram Shopping in 2016.
Ollywan alleged Meta violated U.S. antitrust law by integrating Instagram with Instagram Shopping, which lets users buy products tagged in posts. Ollywan in 2016 launched Winstag as a photo-sharing app with product tagging and affiliate shopping features. The startup claimed its chief executive shared a business plan with Meta executives under assurances of confidentiality.
DeMarchi said Ollywan’s antitrust claims were filed too late and failed to plausibly show harm to competition.
Meta has denied any wrongdoing. “Ollywan seeks to misuse the antitrust laws to blame Meta for the failure of its fledgling app and for succeeding where Ollywan failed,” Meta told the court in a filing.
The lawsuit also challenged Meta’s efforts to prevent Ollywan from using the name “Winstag.” DeMarchi said “the antitrust laws do not prohibit Meta from enforcing its trademark rights.”
Meta had argued that the allegations in the lawsuit occurred outside the four-year window for antitrust claims under federal law. DeMarchi said Ollywan did not explain “how filing this action two years after ceasing operations could be considered a prompt filing.”
The judge said she will allow Ollywan to file an amended lawsuit, with limitations.
Meta faces other antitrust lawsuits, including one from a defunct photo-sharing app that claims Meta drove it out of business. Meta last year defeated a lawsuit by the Federal Trade Commission that sought to force it to restructure or sell Instagram and WhatsApp. The company has denied the allegations in both cases.