Facebook (FB) May Have to Sell Instagram and WhatsApp

Facebook (FB) is off its high of $291.78 to $275.02 premarket. The Federal Trade Commission, bolstered by 48 attorney generals have field two antitrust actions against FB alleging anti-competitive conduct. It is sort of funny – what business does not engage in anticompetitive behavior. We are a country of laws – MANY LAWS

. We have more laws than is possible to enforce. We simply lack the resources, people, to enforce all the laws we have.

Because of this laws are no longer enforced fairly – if they ever were. They are not enforced fairly because there are so many laws that all can’t be enforced equally by the authorities charged with the authority to enforce them. This leads to a situation of being able to pick and chose the law that they want and the party they wish to pursue. This creates a situation that if you’re a company that gets sideways with an enforcement agency you become an easy target. One lawsuit can devastate a small to midsized company.

Facebook is calling the lawsuits “revisionist history” of two major acquisitions the government approved several years ago. Again, this is proof that a) there are too many laws and it is impossible to enforce them all and b) if you get sideways with the government or some official want to make a name for themselves it is easy to pick a law and go after anyone or company.

Facebook’s chief counsel Jennifer Newstead said, “[t]he most important fact in this case, which the Commission does not mention in its 53-page complaint, is that it cleared these acquisitions years ago . . . [t]he government now wants a do-over, sending a chilling warning to American business that no sale is ever final.” Again, so many laws the government can easily pick and choose and decide at any given moment who to target.

We anticipate that this will amount to a bump in the road for FB stock.