A social media app developer sued Facebook for alleged anti-competitive...
A social media app developer sued Facebook for alleged anti-competitive behavior. The complaint was filed in the U.S. District Court, San Diego, by Sambreel Holdings. Some of Sambreel’s products “compete with Facebook in the sale of display advertising impressions,” Sambreel…
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said in the complaint. In 2009, Facebook approached Sambreel regarding its product, PageRage. Facebook said PageRage “needed to be operated independent of the Facebook platform” and requested that the application not operate on the platform and Sambreel removed it, the complaint said. When the app’s users and revenue grew, “Facebook’s attitude towards PageRage changed.” The app “represented a particular threat to Facebook because it offered advertisers a low-cost alternative to purchasing advertisements from Facebook.” Sambreel alleged that Facebook violated the Sherman Antitrust Act and California state laws prohibiting unfair competition and interference with contract. Facebook informed Sambreel’s advertising partners “that they would not be allowed to work with Facebook or the application developers unless they ceased doing business with PageRage,” Sambreel said. As a result, advertising rates fell by more than 50 percent, “as demand for PageRage ad impressions plummeted.” Sambreel also filed a motion for a preliminary injunction to prevent Facebook from requiring its partners to boycott. “We believe this complaint is without merit and we will fight it vigorously,” a Facebook spokesman said.